Nuremberg Trial Proceedings Volume 13

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Monday, 6 May 1946

Morning Session

[The Defendant Funk resumed the stand.]

DR. SAUTER: Mr. President, I will continue my questioning of the Defendant Dr. Funk. On Saturday we were discussing the appointment of Dr. Funk as Reich Minister of Economics and now I turn to his appointment as President of the Reichsbank.

Witness, I believe it was in January 1939 when you also became President of the Reichsbank as successor to Dr. Schacht. How did that appointment come about?

FUNK: I had just returned from a journey about the middle of January 1939. I was called to the Fuehrer and found him in a state of great agitation. He told me that the Reich Minister of Finance had informed him that Schacht had refused the necessary financial credits and that consequently the Reich was in financial straits. The Fuehrer told me, in great excitement, that Schacht was sabotaging his policies, that he would not tolerate the Reichsbank's interference with his policies any longer and the gentlemen in the Reichsbank Directorate were utter fools if they believed that he would tolerate it. No government and no chief of state in the world could possibly make policy dependent on co-operation or non-co-operation of the issuing bank.

The Fuehrer further declared that from now on he himself, on the suggestions and demands of the Reich Minister of Finance, would fix all credits to be given by the Reichsbank to the Reich. He had given Lammers instructions to formulate a decree, together with the Reich Minister of Finance, by which the status of the Reichsbank, as established by the provisions of the Treaty of Versailles, would be changed, and whereby the terms for the granting of credits to the Reich would be determined by himself alone in the future.

The Fuehrer further said that he was asking me to take over the direction of the Reichsbank, whereupon I replied that I would be glad to comply with his wish, but that first of all I had to have confirmation from him that the conditions for stabilization of currency would be maintained.


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The opinion, which was voiced here by a witness, that inflation would be brought about through a further grant of credits at that time is wrong and totally untenable. Although 12,000 millions of credit can have an inflationary effect, 20,000 millions of credit will not necessarily tend toward inflation if the state has the necessary authority to stabilize prices and wages and to carry out the regulation and administration of prices, and if the people maintain the proper discipline in this respect, and if, finally, the money which as a result of increased credits represents excess purchasing power is diverted through taxes or taken up through loans; then, as far as the currency is concerned, there is absolutely no danger.

It is a fact that the Reichsmark, up to the final collapse, was kept on a stable basis. As far as the essentials of life are concerned, the purchasing power of money in Germany was secure. Of course, its value was limited insofar as consumers' goods were produced only on a very limited scale, for almost all production was turned over to armaments.

DR. SAUTER: Dr. Funk, have you concluded?

FUNK: Just one moment, please. I believe this is a very important question.

In other countries as well, large credits were issued during the war which did not in any way cause an inflation. The national debt in the United States as well as in England was relatively, and in part even absolutely, higher than that in Germany. And in these countries, too, a correct financial policy overthrew the old thesis that a war would, of necessity, bring about the destruction of the monetary value.

The German people, up to the very end, until the terrible collapse, maintained admirable discipline. Money as a function of the state will have its value and currency will function so long as the state has authority to maintain it on a stable basis, to keep the economy under control, and as long as the people themselves maintain the necessary discipline.

Thus I took over this office not with the knowledge that Germany was now entering an inflation period but, on the contrary, I knew well that through maintenance of a suitable governmental policy the currency could be protected, and it was protected. However, the basic difference between Schacht's position and my position lay in the fact that during Schacht's time the Reichsbank could determine the granting of credits to the Reich, whereas this authority was taken from me, and the responsibility for domestic finances, therefore, was turned over to the Minster of Finance or of course to the Fuehrer himself.


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DR. SAUTER: Dr. Funk, I have another question. Perhaps, despite your poor state of health today, you might be able to speak a little more loudly so that the stenographers might understand you more easily. Please try, and we will make this as brief as possible.

Witness, then in addition to these offices of yours which we have discussed up to now, you finally had a further office as successor of Dr. Schacht, namely, that of Plenipotentiary General for Economy. Can you give us some details of your view in this connection in order to clarify your situation, your activity, and your achievements?

FUNK: This of all the positions I had was the least impressive. As the Reich Marshal correctly stated, and as Dr. Lammers confirmed, it existed merely on paper. That, too, was an essential difference between the position which Schacht had and the one which I had.

Schacht had been appointed Plenipotentiary General for War Economy. I, on the other hand, was the Plenipotentiary General for Economy. According to the Reich Defense Law of 1938, the Plenipotentiary General for Economy was to co-ordinate the civil economics departments in preparing for a war. But, in the meantime, these economic departments had been subordinated to the Delegate for the Four Year Plan, and I, as Plenipotentiary General for Economy, was also subordinate to the Delegate for the Four Year Plan.

Consequently, there was confusion and overlapping in matters of competence and authority as they had been laid down formally. The result was a directive of the Fuehrer just a few months after the beginning of the war which de jure and formally transferred the authority of the Plenipotentiary General for Economy, as far as the civil economic departments were concerned, to the Delegate for the Four Year Plan.

DR. SAUTER: When was that?

FUNK: That was in December of 1939. There remained only a formal authority to issue directives, that is, I could sign directives on behalf of the five civil economic departments, which, according to the Reich Defense Law, were subordinate to the Plenipotentiary. I retained authority over the Ministry of Economics and the Reichsbank, which I had in any case.,

DR. SAUTER: But you were subordinate even in these functions to the Delegate for the Four Year Plan; is that correct?

FUNK: Yes, like all civil economic departments. Only with the Ministry of Economics itself did I have a closer connection.

DR. SAUTER: Witness, in August 1939, that is, immediately before the beginning of the Polish campaign, you in your capacity


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as Plenipotentiary General for Economy summoned the civil economic offices to a meeting for discussions, and Document 3324-PS refers to this meeting. It seems to me important that you define your attitude on this point also, and especially with reference to the fact that apparently your letter to Hitler, dated 25 August, was a result of this meeting. This matter is mentioned in your trial brief on Page 24. Will you comment on it?

FUNK: In Schacht's time there existed an office for the Plenipotentiary General for Economy, and a working committee was set up which consisted of the representatives of the various economic departments, as well as of the Ministry of the Interior, the Plenipotentiary for Administration, the OKW, and above all, of the Four Year Plan.

When Schacht resigned, the direction of this committee and of the office of the Plenipotentiary for Economy was transferred to Dr. Posse, his former State Secretary, whereas under Schacht State Counsellor Wohlthat had headed the office and the committee. These people, of course, had constant consultations, in which they discussed measures necessary in the economic sphere for waging war. And this was the organization of the Plenipotentiary for Economy which I dealt with in my speech in Vienna which had been mentioned here. It existed alongside the Four Year Plan, and in the main was charged with a smooth conversion of the civilian economy into a war economy in the case of war, and with the preparation of a war economy administration.

When, in August of 1939, there was a threat of war with Poland, I called together the chiefs of the civil economic departments, as well as the representatives of the Four Year Plan, and, in joint consultation, we worked out measures necessary for converting the civilian economy into a war economy in the case of a war with as little disturbance as possible.

These were the proposals which I mentioned in my letter to the Fuehrer dated 25 August 1939, at a time when the German and Polish Armies already faced each other in a state of complete mobilization.

It was, of course, my duty to do everything to prevent dislocations of the civilian economy in the case of a war, and it was my duty as President of the Reichsbank to augment gold and foreign exchange assets of the Reichsbank as much as possible.

This was necessary first of all because of the general political tension which existed at the time. It would also have been necessary if war had not broken out at all, but even if only economic sanctions had been imposed, as was to be expected from the general foreign political tension which existed at the time. And it was


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equally my duty, as Minister of Economics, to do everything to increase production.

But I did not concern myself with the financial demands of the Wehrmacht, and I had nothing to do with armament problems, since, as I have already said, the direction of peacetime as well as war economy had been turned over to the Delegate for the Four Year Plan.

The explanation for the fact that at that time I kept aloof from the work of that committee is the following:

I personally did not believe that there would be war, and everyone who discussed this subject with me at that time will confirm this. In the months before the beginning of the war I concentrated my entire activity on international negotiations for bringing about a better international economic order, and for improving commercial relations between Germany and her foreign partners.

At that time it was arranged that the British Ministers Hudson and Stanley were to visit me in Berlin. I myself was to go for negotiations to Paris where, in the year 1937, I had come to know some members of the Cabinet when I organized a great German cultural fete there.

The subject of short-term foreign debts had again to be discussed and settled-the so-called moratorium. I had worked put new proposals for this, which were hailed with enthusiasm, especially in England. In June of 1939, an international financial discussion took place in my offices in Berlin, and leading representatives of the banking world from the United States, from England, from Holland, France, Belgium, Switzerland, and Sweden, took part in it.

These discussions led to results which satisfied all parties. At the same time I carried out the exchange or transfer of Reichsbank assets in foreign countries. This exchange of gold shares also was considered very fair and satisfactory in foreign banking circles and the foreign press.

In June of that year I went to Holland to negotiate trade agreements. I also participated in the customary monthly discussions of the International Clearing Bank at Easel as late as the beginning of July 1939, and despite the strong political tension which existed at the time I was convinced that a war would be avoided and I voiced this conviction in all my discussions, at home and abroad. And this is why during those months I was barely interested in the discussions and consultations on the financing of the war and the shape of war economy.

I had, of course, given instructions to the Reichsbank to use its available economic assets abroad as far as possible to obtain gold


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and generally to increase our foreign assets. But in the few months of my activity in this sphere before the war, the success of this endeavor of mine was slight. Our gold assets and foreign assets, as they were turned over to me by Schacht, remained on the whole unchanged until the war.

In my questionnaire to the Reichsbank Vice President, Puhl, I requested enlightenment on these transactions, since the Directorate of the Reichsbank and its managing director who, at that time, was Puhl, are bound to have information on this matter. The answer to this questionnaire, I am sorry to say, has not as yet arrived.

DR. SAUTER: Witness, you gave these details obviously to show that despite the political tension at the time you did not even think seriously of war.

FUNK: Not until August 1939.

DR. SAUTER: Now, in the course of these proceedings, we have heard about a series of discussions which Hitler had with generals and other personalities, and which concerned military and political matters. All these were discussions which we must say today stood in closest connection with preparations for war.

At which of these discussions were you present, and what did you gather from them?

FUNK: I was never called into political and military discussions, and I did not participate in any of these discussions which were mentioned here in connection with the charge of planning an aggressive war, so far as discussions with the Fuehrer are concerned. I was also not informed about the contents of these discussions. And as far as I can remember, I was hardly ever present at the discussions with the Reich Marshal, when they dealt with this topic.

I have been confronted here with a meeting which took place in October of 1938.

DR. SAUTER: 14 October 1938? I can tell you the document number. It is 1301-PS.

FUNK: Yes.

DR. SAUTER: Were you present at that meeting?


DR. SAUTER: That was the meeting.

FUNK: Yes, that was the meeting in which, according to the indictment against me, Goering pointed out that he had been instructed by the Fuehrer to increase armament to an abnormal extent. The Luftwaffe was to be increased fivefold, as speedily as possible.


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The Prosecutor, according to the official record (volume V, Pages 163, 164), asserts that, in this discussion, Goering addressed me in the words of a man who was already at war. I was not even in Germany those days but in Bulgaria, and consequently I could not participate in this meeting.

DR. SAUTER: Mr. President, as proof of the fact that the Defendant Funk was not in Germany at the time of this discussion with Goering on 14 October 1938 I have submitted several documents in the Document Book Funk; they are extracts from the Volkischer Beobachter, Numbers 5, 6, 7, and 8 of the Funk Document Book. These documents are submitted chiefly because they show that in fact from 13 October 1938 until 15 October 1938 Funk was at Sofia in Bulgaria, and therefore could not have been present at the Goering meeting on 14 October 1938.

What Funk said in Bulgaria about economic relations I need not read in detail. But I would like to refer especially to his speech of 15 October 1938, Funk Document Book Number 7, in which the Defendant Funk, particularly in the first paragraph, declared publicly that the thought of an economic union between the German economy and the Southeastern European economy was in his mind, and in which Funk quite definitely rejected a one-sided dependence of the economy of the southeastern states on the economic system of Germany.

Therefore I beg the Tribunal to take judicial notice of these documents as evidence and in order to save time I will not go into them further.

Witness, under Document Number PS-3562 the Prosecution has submitted a document dealing with a conference on 1 June 1939. You yourself did not attend this meeting, but according to the list of those present several representatives of your Ministry were there, as well as the representative of the Reichsbank. At this meeting the probable financial needs of the Reich in case of a war, the productive capacity of the Germany economy, and that of the Protectorate in case of a war were discussed. There is a marginal note in this record which says that the record was to be submitted to you. Can you state very briefly whether this was actually done?

FUNK: No, it was not done. I have the document here. If this record had been submitted to me I would have affixed my initials "W. F." to it. Besides, this document deals with the continuous discussions, which I have already mentioned, about the financing of the war, and the measures to be taken in the field of civilian economy in case of a war. The decisive measures for the financing were naturally prepared by the Reich Minister of Finance, and these measures were discussed at length in this


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conference at which the question of meeting the expenses through taxes was one of the chief topics. In any event, a variety of such discussions was carried on continuously at that time among the representatives of the various departments, and they took place in the office of the leading staff of the Plenipotentiary for Economy. By chance I have now found this name which earlier I could not remember: this was the institution-the committee-which was founded in the days of Schacht and was later continued.

DR. SAUTER: Dr. Funk, on 30 March 1939 you made a statement of your program in a speech before the Central Committee of the Reichsbank.

I have included these excerpts from the speech which have a bearing on this Trial in the Funk Document Book under Number 9. I am coming back to this speech because it was delivered before the Central Committee shortly after the defendant assumed his office as President of the Reichsbank, and represents his program as President of the Reichsbank in connection with various matters which have played a part here.

Dr. Funk, perhaps with just a few brief words you might give us the essential relevant points of your speech, insofar as the Prosecution is interested in them.

FUNK: I do not believe I need do that. I briefly mentioned a while ago that in these months I carried on international discussions about the necessity for a new order in international economic relations, and that I also pointed out Germany's readiness to play a positive part. Therefore, I do not think I need read anything more from this speech; it is only meant to show that at that time I did not work on preparations for war but endeavored to bring about international economic understanding, and that these, my efforts were recognized publicly in foreign countries, especially in England.

DR. SAUTER: This intention to establish favorable and confident relations with foreign countries, that is, with their financial and economic circles, was, I am sure, a deciding factor in a later measure to which you already referred a little while ago, namely that compensation to foreign shareholders in the Reichsbank, who, I believe, existed chiefly in England, Holland, and Switzerland, was assessed and paid in a particularly loyal manner.

FUNK: Yes, I have stated that already.

DR. SAUTER: Dr. Funk, you mentioned earlier a letter which you wrote to Hitler. This letter would be interesting to me insofar as I would like to know just why you wrote it, and why in it you spoke of "your proposals," even though in the main they were


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concerned with things which did not actually originate with you. Perhaps you will say a few words about this letter.

FUNK: The tone and contents of this letter can be explained from the general mood which existed everywhere in Germany at that time. Beyond that it is a purely personal letter to the Fuehrer: In it I thanked him for his congratulations on my birthday. For this reason the letter is a little emphatic in its style. When I spoke of "my proposals," this may be traced back to the fact that I had personally some time before explained to the Fuehrer what measures would be necessary if a war broke out. And in the main, those were the measures which were adopted later as a result of conferences with the other economic offices, and to which I referred in this letter. Thus it was not quite correct for me to say "my proposals." I should really have said, "The proposals worked out together with the other economic offices."

DR. SAUTER: Dr. Funk, have you concluded?

FUNK: No. I would like to explain this whole letter with just a few words, since it is apparently one of the pillars of the Prosecution's case against me.

As I have said, it was the time when the two mobilized armies faced each other. It was the time when the entire German people were in a state of great excitement because of the constant provocations and the ill-treatment of the German population in Poland. I personally did not believe that we would actually have war, for I was of the opinion that diplomatic negotiations could again be successful in preventing the threat of war and indeed in avoiding war itself. After the Fuehrer's almost miraculous successes in foreign policy, the heart of every true German had to beat faster in the expectation that in the East also Germany's wishes would be fulfilled; that is, that my separated home province of East Prussia would be reunited with the Reich, that the old German city of Danzig would again belong to the Reich, and that the problem of the Corridor would be solved.

The overwhelming majority of the German people, including myself, did not believe that this question would end in war. We were rather convinced that England would be successful in exerting pressure on Poland. so that Poland would acquiesce in the German demands on Danzig and the Corridor and would not bring on a war. The testimony of the witness Gisevius must have made clear to everyone in the world that England did nothing at that time to exert a soothing and conciliatory influence on Poland. For if the British Government knew that a conspiracy existed in Germany in which the Chief of the General Staff, the Chief of the OKW, the Chief of German Armament and other leading


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military personalities and generals were involved, and that an overthrow had been prepared for the event of war, then the British Government would have been foolish indeed if they had done anything to assuage and conciliate Poland. The British Government must have been convinced that if Hitler should go to war, a coup d'etat, a revolution, an overthrow would take place, and that, in the first place, there would be no war and, secondly, that the hateful Hitler regime would be removed. Nobody could hope for more.

DR. SAUTER: Dr. Funk, we do not want to talk politics, but rather return to this letter of 25 August 1939. May I repeat the number, 699-PS. Let us at present deal only with this letter. If I understood you correctly, I can summarize your testimony as follows: This rather enthusiastic letter to Hitler was written because-you were hopeful that Hitler would succeed in reuniting your home province of East Prussia with the Reich, and would now finally settle the Corridor problem without a war. Did I understand you correctly?

FUNK: Yes, but at the same time I feel I must state that I on my part did everything to ensure that in the event of war peace-time economy would without disturbance be converted into a war economy. But this was the only time at which, as Plenipotentiary for Economy, I was active at all with regard to the other economic departments and the fact that I referred to my position in this letter may be explained quite naturally, because I was proud that I had for once done something in this official position-for every man likes to be successful.

DR. SAUTER: Dr. Funk, we are still concerned with the question of whether you knew of Hitler's intent to bring about a war, especially to wage aggressive war and to make conquests through aggressive wars. I would like to put to you a few questions which, for the sake of simplicity, you can answer with "yes" or "no"; I would like to know only whether your knowledge and your presentiment agree with the statements made by a few witnesses and some codefendants.

For example, Reich Minister Lammers testified that you found it especially difficult to see Hitler at all, that an audience was granted you only once in a long while, and that even on one occasion I believe you waited for days with Lammers at headquarters for the promised audience, and that you had to leave again without having gained admittance. Is that correct?

FUNK: Yes, I am sorry to say.

DR. SAUTER: Now a further question: We have been confronted with several documents which say explicitly-I believe they are


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records of Lammers-that the Reich Minister of Economics, and at one time also the Reich Foreign Minister, had requested to be called in to these discussions, that Minister Lammers did his best to bring this about, but that Hitler did not allow it, that he expressly barred you and the Reich Foreign Minister from attending these discussions even though you pointed out that important matters of your department were being dealt with. Is that correct? Perhaps you can answer with just "yes" or "no."

FUNK: The meeting which you mention is concerned with the deployment of labor. I myself had no direct connection with that, and the Foreign Minister probably did not have any marked interest in it either. So I assume that for these reasons the Fuehrer did not need me, for as I said yesterday his directives for the conduct of economy were given, up to the year 1942, to the Reich Marshal as the man responsible for that field, and after 1942 the directives were given to Speer, because from that date on armaments dominated the entire economic life, and all economic decisions, by express order of the Fuehrer, had to give way to armament needs.

DR. SAUTER: Dr. Lammers, in his testimony on 8 April, stated- I quote:

"The Fuehrer objected many times, namely against Funk. There were various reasons for objecting to Funk. Hitler was skeptically inclined toward Funk and did not want him."

Thus for the testimony of the witness Dr. Lammers. Can you explain why Hitler was disinclined toward you?

FUNK: No, only by the objective explanation that he did not need me.

DR. SAUTER: In other words, he considered any discussions with you superfluous.

FUNK: Yes.

DR. SAUTER: Witness, in connection with the topic of aggressive wars, I would be interested in the following: In the Indictment, on Page 30 of the German trial brief, it is set forth that you personally and through your official representatives, that is you personally as well as through the representatives who were appointed by you, participated in the preparation for the aggressive war against Russia, and as the sole proof for this Document Number 1039-PS, Exhibit USA-146, is submitted. From this document it appears that you, Defendant, at the end of April 1941, allegedly had a discussion with Rosenberg-who was responsible for the Eastern Territories-about the economic questions which would arise if the plans for attack in the East were to be carried through. I ask you, Dr. Funk, to note the date of this discussion: the end of


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April 1941, just a short time before the beginning of the war against Russia. In order to refresh your memory I want to point out that at that time, that is, before the war against Russia, Rosenberg had already been nominated as Hitler's plenipotentiary for the uniform handling of problems in the Eastern Territories. I am asking you now to define your position and to say whether it can be derived from this discussion that you participated in an aggressive war against Russia or its planning and preparation, and if you did participate, how?

FUNK: I knew nothing about an aggressive war against Russia. I was very much surprised when I learned from Lammers that the Fuehrer had made Rosenberg plenipotentiary for Eastern European problems. Lammers stated here that he had me advised of this nomination for personal reasons, because he knew that I was very much interested in economic relations with Russia. Indeed, our mutual efforts, Russia's as well as Germany's, had succeeded in considerably expanding our trade relations; for in earlier times, that is, before the first World War, German trade with Russia had been the decisive factor in the balance of German trade and had amounted to several thousand million gold marks.

The Russians-I must say this here-furnished us grain, manganese ore, and oil very promptly, while our deliveries of machines lagged behind for the natural reason that the machines had first to be produced since the Russian orders were mainly for specialized machines. To what extent army supplies were sent to Russia, I do not know, as I did not deal with these.

And so I was surprised by the appointment of Rosenberg. He called on me for a short discussion in which he told me that the task given to him by the Fuehrer also included handling of economic problems. Thereupon I placed a ministerial director in my ministry, Dr. Schlotterer, at Rosenberg's disposal to work on these problems. And when the Ministry for Eastern Affairs was founded, as far as I know, in July, Dr. Schlotterer, with some of his colleagues, took over the direction of the economic department in Rosenberg's Ministry. And simultaneously, as far as I remember, Dr. Schlotterer became a member of Economic Operational Staff East. This was the institution of the Four Year Plan which has been mentioned repeatedly here during the proceedings and which dealt with all economic problems in the Occupied Eastern Territories.

Beyond that, I had nothing to do with these matters. Naturally I asked Lammers as well as Rosenberg just what this signified, and both of them told me that the Fuehrer was of the opinion that a war with Russia would become unavoidable, that along the entire Eastern Front the Russians had concentrated large reinforcements, that the discussions with Molotov, in which I had no part at all, had been


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unsatisfactory, that the Russians were making demands regarding the Baltic, the Balkan regions, and the Dardanelles, which could not be accepted by Germany, by the Fuehrer. At any rate, this affair was as complete a surprise to me as to the German people, and I am convinced that this war was a great shock to the German people.

THE PRESIDENT: The witness spoke of July. Did he mean July 1940?

DR. SAUTER: As far as I know, July 1941.

THE PRESIDENT: You mean July 1941? That was after the war with Russia had begun. The witness can answer for himself, I suppose, can he not?

[Turning to the defendant.] Did you mean July 1940?

FUNK: The discussion with Rosenberg was at the end of April or the beginning of May 1941, and the Rosenberg Ministry was founded in July 1941.

DR. SAUTER: I now turn to a different point raised by the Prosecution. You are accused of having, as Reich Minister of Economics, committed punishable acts in connection with the criminal plan to persecute the Jews and to eliminate them from economic life. These are the happenings of November 1938. Will you therefore now describe your activity in this respect.

FUNK: May I ask the Tribunal to give me time for a rather detailed account on this topic. Then the points which we will treat later can be dealt with much more briefly. This is the charge of the Prosecution which really affects me most gravely.

When I took over the Ministry of Economics in February 193S, I very soon received demands from the Party, and especially from Goebbels and Ley, to eliminate the Jews from economic life, since they could not be tolerated. I was told that people were still buying in Jewish stores, and that the Party could not permit its members to buy in such stores; the Party also took offense at the fact that some high state officials, and in particular their wives, were still shopping in such stores. The sectional chairmen of the Labor Front refused to work with Jewish managers. There were constant clashes, I was told, and there would be no peace if the measures which had already been introduced here and there were not extended gradually to eliminate the Jews completely from economic life.

The Law for the Organization of National Labor, which was decreed under my predecessors and which was also carried through by them in agreement with the German Labor Front, had assigned political and Party functions also to domestic economy. The plant manager was also responsible to the Party and above all to the State.


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Some Jewish managers readily succumbed to the pressure and sold their businesses and enterprises to people and at prices of which we did not approve at all. I had made private agreements with individual Jewish leading men in banking, heavy industry and the big stores, and had thus brought about their withdrawal from positions in economic life. There was no peace, and we had to try within a certain time and in line with certain legal decrees to force back and gradually eliminate Jewish influence from economic life. In this connection, I personally always represented the view that, first of all, the process should be carried out slowly, with intervals of time; secondly, that the Jews should be given adequate compensation, and thirdly, that one might leave certain economic interests in their hands, especially their security holdings; and I particularly emphasized this in the meeting with Goering which has been mentioned here so frequently

Now while these developments were taking shape, the terrible happenings of the night of 9-10 November 1938, originating in Munich, burst upon us and affected me personally very deeply. When I drove to my ministry on the morning of 10 November, I saw on the streets and in the windows of the stores the devastation which had taken place and I heard further details from my officials in the Ministry. I tried to reach Goering, Goebbels, and I think Himmler, but all were still traveling from Munich. Finally I succeeded in reaching Goebbels. I told him that this terror was an affront against me personally, that through it valuable goods which could not be replaced had been destroyed, and that our relations with foreign countries, upon which we were particularly dependent at this time, would now be disturbed noticeably.

Goebbels told me that I personally was responsible for this state of affairs, that I should have eliminated the Jews from economic life long ago, and that the Fuehrer would issue an order to Reich Marshal Goering according to which the Jews would have to be completely eliminated from economic life; I would receive further details from the Reich Marshal. This telephone conversation with Goebbels was confirmed by him later, and witnesses will verify this.

The next day, 11 November, I was informed that there was to be a meeting on the 12th with Goering in his capacity as Delegate for the Four Year Plan, for the purpose of settling the Jewish problem. The Delegate for the Four Year Plan had given instructions to the Ministry to prepare a draft for a decree which was to be the basis of laws for the elimination of the Jews from economic life.

On the 12th this meeting, which has been discussed here frequently, took place. There was a discussion with the Reich Marshal in the morning at which the Gauleiter were present. The Reich


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Marshal was highly excited; he said that he would not tolerate this terror and that he would hold the various Gauleiter responsible for what had happened in their Gaue.

After this meeting I was therefore comparatively relieved, but at the meeting, of which the record has been read here several times, Goebbels very soon produced his very radical demands and thereby dominated the whole of the proceedings.

The Reich Marshal became increasingly angry and in this mood he gave way to the expressions noted in the record. Incidentally, the record is full of gaps and very incomplete. After this meeting it was clear to me that now indeed the Jews would have to be eliminated from economic life, and that in order to protect the Jews from complete loss of their rights, from further terror, attacks, and exploitation, legal measures would have to be decreed. I made provisions, and so did the Minister of Finance, the Minister of the Interior, the Minister of Justice, and so on, for the execution of the original decree of the Delegate for the Four Year Plan in which the transfer of Jewish businesses and Jewish shares to trustees was stipulated. The Jews were compensated by 3 percent bonds, and I always saw to it that, as far as the Ministry of Economics was involved in this, this decision was carried out faithfully and according to the law and that the Jews did not suffer further injustice. There was at that time certainly no talk of an extermination of the Jews. However, a plan for the organized emigration of the Jews was briefly discussed at that meeting. I personally did not participate in any way in the terroristic, violent measures against Jews. I regretted them profoundly and sharply condemned them. But I had to authorize the measures for the execution of those laws in order to protect the Jews against a complete loss of rights, and to carry through in an orderly manner the legal stipulations which were made at that time.

DR. SAUTER: Dr. Funk . . .

THE PRESIDENT: We had better adjourn now.

[A recess was taken.]

DR. SAUTER: Witness, before the intermission we last spoke of your activity concerning the decrees for the exclusion of Jews from economic life and you told us about the minutes of the session with Goering on 12 November 1938. That is Document Number 1816-PS.

You have already mentioned that the minutes of that conference were poorly edited and are full of omissions, but we can see from these minutes that you openly and definitely exerted a restraining influence and that you tried to save one thing or another for the


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Jews. I see, for instance, from the minutes that during the conference you repeatedly maintained that the Jewish stores should be reopened again speedily. Is that correct?

FUNK: Yes.

DR. SAUTER: You also pleaded, according to the minutes, that the Jews should be able to keep their shares and interests. That is shown in a question which you put. Is that correct?

FUNK: I have already said that I had thought, up to the time of that conference, that the Jews could keep their securities; and in the course of the conference I said that it was quite new to me that the Jews should also surrender the securities they possessed. Ultimately they got 3 percent government bonds in settlement, but they had to hand over all their shares and other interests.

I was also against a ruling of that kind because the Government would then take over a huge number of securities and the conversion of such securities was of course difficult.

DR. SAUTER: From the minutes it also appears that Heydrich was in favor of placing the Jews in ghettos, and you recall that the Prosecution has already mentioned that here.

What was your attitude, Dr. Funk, to Heydrich's proposal at that time?

FUNK: I was against ghettos for the simple reason that I considered a ghetto a terrible thing. I did not know any ghettos, but I said that 3 million Jews can surely live among 70 million Germans without ghettos. Of course, I said that the Jews would have to move together more closely, and one would have to assist the other, for it was clear to me, and I also said so during the conference, that the individual Jew could not exist under the conditions which were now being created for him.

DR. SAUTER: In that connection, Mr. President, may I be permitted to point out two affidavits which I included in the Funk Document Book under Number 3 and Number 15, and may I ask you to take official notice of their complete contents as evidence?

Affidavit Number 3 in the document book, on Page 12 of the text, is one by the defendant's wife, signed by her about the beginning of the Trial on 5 November 1945. From that affidavit, of which I shall summarize the essential passages, we can see that at the time of the excesses against the Jews in November 1938 the defendant, together with his wife and his niece, was in Berlin, and therefore not in Munich where the so-called "Old Fighters" were assembled and where Minister Dr. Goebbels quite suddenly and to the surprise of everyone gave the order for these Jewish pogroms. Frau Funk confirms in her affidavit that her husband, as soon as


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he heard of these excesses, called Dr. Goebbels over the telephone in great excitement and asked him:

"Have you gone crazy, Goebbels, to commit such outrages? It makes one ashamed to be a German. Our whole prestige abroad is being lost. I am trying day and night to preserve the national patrimony and you throw it recklessly out of the window. If this beastly mess does not stop immediately, I will throw everything overboard."

That literally was the telephone conversation which at that time the defendant had from Berlin with Dr. Goebbels. And the remaining contents of that affidavit are concerned with intercessions which the defendant made for individual Jewish acquaintances. And, Gentlemen, there is a similar vein in the affidavit by Heinz Kallus, who was ministerial counsellor in the Ministry of Economics under the Defendant Funk.

I have submitted this affidavit as Number 15 of the Funk Document Book. It is dated 9 December 1945, and this witness also confirms that Funk was, of course, extremely surprised by these excesses, and that he thereupon immediately got in touch with the competent authorities in order to prevent further outrages.

Thus these affidavits largely confirm the account which the Defendant Funk himself has given. In connection with this affair concerning the Jews, I should like to return to Document Number 3498-PS, which can be found on Page 19 of the trial brief against Funk. That is a circular letter by Funk of 6 February 1939, published in the official gazette of the Reich Ministry of Economics, and from it I quote:

"To what extent and rate the authority of the Four Year Plan is to be used depends on instructions given by me in accordance with the directives of the Delegate for the Four Year Plan."

I quote this because, here again, in an official publication of that time, the Defendant Funk expresses clearly that, in this field too, he had merely to obey and to execute the directives of the Four Year Plan. Is that correct, Dr. Funk?

FUNK: Yes.

DR. SAUTER: Dr. Funk, you said earlier that in keeping with your entire past and your basic principles, and in keeping with your entire philosophy, you considered as particularly severe the charge concerning the elimination of Jews from economic life. And in this connection I want to put to you that during an interrogation in Nuremberg on 22 October 1945, you finally broke into tears and told the interrogating officer, '`At that time I should have resigned. I am guilty." And this was quoted literally on one occasion in the


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course of the proceedings. Perhaps you can tell us how that remark and that breakdown on your part occurred which I find mentioned in the record.

FUNK: I had at that time just been brought from hospital into prison.

DR. SAUTER: Dr. Funk, one question...

FUNK: I did not know before that I had been accused of being a murderer and a thief and I do not know what else. I was sick for 9 or 10 weeks, and from the hospital bed I was brought here during the night. During those days my interrogations here started immediately. I must admit that the American officer who interrogated me, Colonel Murrey Gurfein, conducted the interrogation with extreme consideration and forbearance and again and again called a halt when I was unable to go on. And when I was reproached with these measures of terror and violence against the Jews I suffered a spiritual breakdown, because at that moment it came to my' mind with all clearness that the catastrophe took its course from here on down to the horrible and dreadful things of which we have heard here and of which I knew, in part at least, from the time of my captivity. I felt a deep sense of shame and of personal guilt at that moment, and I feel it also today. But that I issued directives for the execution of the basic orders and laws which were made, that is no crime against humanity. In this matter I placed the will of the State before my conscience and my inner sense of duty because, after all, I was the servant of the State. I also considered myself obliged to act according to the will of the Fuehrer, the supreme Head of the State, especially since these measures were necessary for the protection of the Jews, in order to save them from absolute lack of legal protection, from further arbitrary acts and violence. Besides, they were compensated and, as can be seen from the circular letter which you have just quoted, I gave strict instructions to my officials to carry out these legal directives in a correct and just way.

It is terribly tragic indeed that I in particular am charged with these things. I have said already that I took no part in these excesses against the Jews. From the first moment I disapproved of them and condemned them very strongly, and they affected me personally very profoundly. I did everything, as much as was within my power, to continue helping the Jews. I never thought of an extermination of the Jews, and I did not participate in these things in any way.

DR. SAUTER: Dr. Funk, as you are just speaking of the fact that you did not think of an extermination, an annihilation of the Jews, I want to refer to a document which has been quoted before:


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Number 3545-PS; it was submitted by the Prosecution. As you may recall, this is the photostat of the Frankfurter Zeitung of 17 November 1938, an issue which appeared only a few days after the incidents with which we are now concerned. In that issue of the Frankfurter Zeitung a speech of yours was published in which you deal with the legal measures for the exclusion of Jews from German economic life, and you will recall that the Prosecutor, in his speech of 11 January 1946, charged you, and I quote: ". . . that the program of economic persecution of the Jews was only part of a larger program for their extermination."

And that is in conformity with a phrase in your trial brief which says that it was merely a part of, literally, "a larger program for the extermination of the Jews." Now, in all the statements which you made during that time, I nowhere find an indication that you favored an extermination, an annihilation of the Jews, or that you had demanded it. What can you say about that view of the Prosecution?

FUNK: Never in all my life, orally or in writing, have I demanded an extermination or annihilation of the Jews or made any statement to that effect. Apparently this is an utterance of the Prosecutor, which, in my opinion, is based only on imagination or the state of mind in which he has viewed the things from the beginning. I myself have never advocated the extermination of the Jews and I did not know anything of the terrible happenings which have been described here. I did not know anything. I had nothing to do with them; and afterwards, as far as I recall, I never took part in any measures against the Jews, since these matters were no longer dealt with in my departments. With the exception of these legal measures, these executive orders, I do not believe that within my departments I ever again authorized anything further connected with Jewish affairs.

DR. SAUTER: Is it correct, Dr. Funk, that in connection with the carrying out of these directives which you had to issue, you yourself intervened on behalf of a large number of individuals who had to suffer under these directives and who approached you personally for aid, and that you did this in order to mitigate the effect of these decrees?

FUNK: I saw to it that these directives were followed in a fair way and according to the laws. However, the carrying out of these decrees was the responsibility not of the Ministry but of the district president and of the offices dependent on the Gauleiter in the Reich. Many complaints reached me about the manner in which Aryanization was carried out, and my officials will confirm that I intervened in every case when I was informed of such abuses. I even


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dismissed an official of that department when I heard of incorrect behavior; later I also parted with the department head.


FUNK: Because these abuses had occurred. Just as previously I had done everything in my power to aid the Jews to emigrate by making foreign currency available to them, so now, in carrying out these directives, I did everything in my power within the scope of possibility to make things bearable for the Jews.

DR. SAUTER: Mr. President, this question as to what Funk's attitude was in practice toward the carrying out of these decrees which he himself as an official had to issue-this question I have also treated in a questionnaire approved by you, which has been submitted to the former State Secretary Landfried. That questionnaire was returned some time ago but it was discovered that a wrong questionnaire had been sent out by the of lice, and the correct answer was received only on Saturday. It is now being translated and I assume that this correct answer, this testimony of State Secretary Landfried, will be submitted to you in the course of the day and that it can then be entered in the appendix as Document Number 16. I presume, nevertheless, that there will be no objection to my reading the short answer of the witness Landfried in connection with this matter. Herr Landfried was from 1939 to 1943 state secretary . . .

THE PRESIDENT: Has the Prosecution seen the document?

DR. SAUTER: Yes, the Prosecution has the document.

MR. THOMAS J. DODD (Executive Trial Counsel for the United States): We haven't seen this document. We have seen the German text. I don't read German and I haven't had an opportunity to read it. It hasn't been translated.

THE PRESIDENT: The document can be submitted after the Prosecution has seen it. You needn't submit it at this moment. Have you any other witness or not?

DR. SAUTER: Not in connection with this topics

THE PRESIDENT: No, no, but are there any other witnesses

at all?

DR. SAUTER: One witness, Dr. Heidler, but for other subjects.

THE PRESIDENT: And presumably the defendant will be cross-examined.


THE PRESIDENT: These documents will be translated by then.

DR. SAUTER: Yes. Mr. President, if you so desire, then I will have to submit that document later, separately.


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DR. SAUTER: Dr. Funk, I come now to an accusation which, according to my knowledge, has not been mentioned in the trial brief yet; it concerns the problem of the occupied territories, that is, the spoliation of the occupied territories, costs of occupation, clearing systems, stabilization of currency, and the like. The Prosecution asserts that you actively participated in the program of criminal exploitation in the occupied territories. That can be found in the record of the proceedings on 11 January 1946 (Volume V, Page 167). That accusation is not further specified, but in the session of 21 February (Volume VIII, Page 60) there is a mere reference to a decree of the Reich Minister for the Occupied Eastern Territories, the Defendant Rosenberg. That decree was submitted by the Prosecution as Document Number 1015-PS; it is a decree by the Minister for the East, Rosenberg, to the Reich commissioners in the Occupied Eastern Territories. The decree informs the Reich commissioners of the task of the Einsatzstab Rosenberg-it has already been mentioned here on several occasions-namely, that of safeguarding objects of cultural value. I think I may assume that the Reich Ministry of Economics had nothing to do with cultural treasures as such. But-and that is very peculiar-it appears from Rosenberg's letter of 7 April 1942 that a copy of it went not only to various other offices but also to you, that is to say, to the Reich Minister of Economy. And from that fact-apparently from that fact alone-the Soviet prosecutor has deduced the charge that you actively participated in the spoliation of the occupied territories. I had to explain the connection in such detail in order to show exactly with what we are dealing. Can you speak quite briefly about it?

FUNK: Up to the time of this Trial I did not even know what the Einsatzstab Rosenberg was, what its tasks were, what it was doing. I have no knowledge that the Ministry of Economics had anything at all to do with the safeguarding of cultural treasures. I cannot say anything about it.

DR. SAUTER: You cannot say anything about this?

FUNK: No, not with regard to the Einsatzstab Rosenberg. About the policy in the occupied territories, I can say a great deal...

DR. SAUTER: That does not interest us now.

FUNK: But you will probably want to hear that later.

DR. SAUTER: Then, Dr. Funk, in the questionnaire sent to Dr. Landfried which I have mentioned before, I asked five or six questions concerning your attitude to the economic policies in the occupied territories. I also put questions to him on whether you


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had given directives to the military commanders or the Reich commissioners for the occupied territories, or the heads of the civil administration in Alsace-Lorraine, and so on. Furthermore, I asked whether it is correct that economic directives also for the occupied territories did not come from you as Reich Minister of Economics but from the Delegate for the Four Year Plan. Then I asked about your attitude toward the question of exploitation of occupied territories, particularly in the West, the black market, devaluation of currency, and the like.

I cannot read the statements of the witness Landfried at this moment, because, through an error in the office, the answers from .Landfried arrived only last Saturday. Since your personal testimony is now being heard, do you yourself wish to add anything to these questions, or would you just like to underline what I shall submit to the Tribunal as soon as I have received the translation? I put this question because it is practically the last opportunity for you to refer to these subjects.

FUNK: I should like to state my position on various matters, but the details of these problems can naturally be better explained by the state secretaries than by myself

Concerning the directives to occupied territories, the Reich Marshal, as well as Reich Minister Lammers, has stated here that I, as Reich Minister for Economics, had no authority to issue instructions. The Reich Marshal, during his testimony here, stated, and I marked it down, "For the directives and the economic policies carried out by the Minister of Economics and Reichsbank President Funk, the responsibility is fully and exclusively mine."

And concerning the occupied territories, he also said that if I had issued special instructions in the course of official business between the ministry and the administrative offices in the occupied territories, then they derived from the general directives of the Reich Marshal and, as he said, were always based on his personal responsibility.

The position was that directives to the occupied territories in the economic field could only be given by the Delegate for the Four Year Plan. The carrying out of economic policy was the task of the military commanders or the Reich commissioners who were directly subordinate to the Fuehrer. The military commanders, as well as the Reich commissioners, had under them officials from the various departments; among them, of course, also officials from the Ministry of Economics and the Reichsbank; and even private enterprise was represented. There was, of course, close cooperation between the offices of the military plenipotentiaries, the Reich commissioners, and the representatives of the various home departments, with the exception of occupied territories in Russia where


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the Reich commissioners were subordinate to a special minister, that is, the Reich Minister for the Occupied Eastern Territories'. This was an exception, but if we as a ministry wanted to have anything done by the military commanders or the Reich commissioners, we had to make a request or procure an order from the Delegate for the Four Year Plan.

The same applies to the heads of the civil administration in Alsace-Lorraine and in other territories where a civil administration had been set up. Here also, the numerous departments of the Ministry of Economics and the Reichsbank had no direct authority to issue directives.

However, I emphasize again that of course close official contact existed between the directing authorities in the occupied territories and the respective departments in Germany.

I myself-and witnesses will confirm this in questionnaires still outstanding, or in person-made the greatest efforts to protect the occupied territories from exploitation. I fought a virtually desperate struggle throughout the years for the maintenance of a stable currency in these territories, because again and again it was suggested to me that I should reduce the exchange rate in the occupied territories so that Germany could buy more easily and more cheaply in these countries; I did everything that could be thought of to maintain economic order in these territories. In one case, in Denmark, I even succeeded, in the face of opposition from all other departments, in raising the value of the Danish krone, because the Danish National Bank and the Danish Government requested it for justifiable reasons.

I opposed the increase of occupation costs in France in 1942 as well as in 1944. The memorandum of the Reichsbank which I authorized was quoted here by the American Chief Prosecutor.

The occupation costs were determined not by the Minister of Economics and the President of the Reichsbank but by the Minister of Finance and the Quartermaster General-in other words, by the highest Wehrmacht commands-and in the case of France, Denmark, and other countries, also by the Minister for Foreign Affairs.

Therefore, I did whatever I could possibly do-whatever was within my power-to keep the economy of the occupied territories in good order. I was successful finally in persuading the Reich Marshal to issue a decree which prohibited all German personnel from buying on the black market; but that happened only after many abuses in this respect had already occurred.

I want to emphasize also that I considered it necessary for the maintenance of order in the occupied territories that social life there should not be disturbed, and that, therefore, as a matter of


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principle I was always against the forced or excessive deportation of foreign workers from the occupied territories to Germany.

I also expressed this in a conference with Lammers, which has been mentioned here. My state secretaries can confirm that. On the other hand it was naturally clear to me that Sauckel was in a very difficult, indeed desperate, situation. Again and again manpower for German economy was demanded of him. But, particularly after I had turned-over the entire civil production to Speer and engaged in central planning, it was not only not to my advantage, from the point of view of my work, that manpower was brought to Germany from abroad, but it was indeed in my interest that the workers should remain in the occupied territories since the production of consumer goods had been transferred to a large degree to these territories; for as minister responsible for providing consumer goods to the population I had a great interest in seeing that orderly work should be done in the occupied territories and that no economic or social disturbances should occur.

I believe, however, that it will be more to the purpose if my two state secretaries and the Vice President of the Reichsbank, the acting Director of the Reichsbank, Puhl, make detailed statements on these problems, because they were more closely connected than I with carrying matters into practice.

If the accusation is made against me that with the aid of the clearing arrangements we spoliated occupied territories and foreign countries, I can only say that the clearing arrangement was not originally introduced by us in our dealings with the occupied territories or during the war, but that it was the normal method of trade between Germany and her business partners. It was a system which had been forced upon us-and that has been pointed out by Schacht-when other nations resorted to using the proceeds of German exports for the payment and amortization of German debts.

At all times, however, I have emphasized that the clearing debts' were real debts for merchandise, and that is important. I have said again and again that this clearing debt was a genuine debt of the Reich and would be repaid at the rate, the purchase value which was in force at the time when we entered into these obligations. I especially stated that, in detail and as clearly as possible, in my last speeches in Vienna in March 1944, and in Konigsberg in July 1944.

Beyond that, in July, I made the suggestion that after the war the clearing debt should be transformed into a European loan, so that it should not remain on the narrow plain of a bilateral exchange of goods but be effectively commercialized; from this can be seen distinctly that I always considered that clearing debt a genuine debt, so that the nations blithe occupied territories who


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had such claims on Germany could and would be satisfied with the war-and, as I constantly emphasize, at the same rates that existed at the time when the debt was incurred. If, however, the countries would have had to pay reparations on the basis of peace treaties, then these reparations of course, quite reasonably, could only have been paid in goods; and then, equally reasonably, it would have been possible to create a balance between German debts and German claims.

But I never left any doubt about the fact that the clearing debt was to be considered a true debt. Therefore, I have to reject the accusation that with the aid of the clearing system we exploited the occupied territories. And I have to reject even more strongly the accusation that I share responsibility for the burden of unbearable expenses, particularly occupation costs and other outlays of money, which were imposed on the occupied territories. It can be proved that I always objected to excessive financial burdening of the occupied territories. The witnesses will later testify and confirm this.

DR. SAUTER: Mr. President, the defendant has referred to two speeches which he made in Vienna and in Konigsberg. These are two addresses which deal in part with the subject of clearing debts, and in part also with the defendant's favorite subject of a European economic union between Germany and her neighbor nations, that is to say, an economic union on the basis of full equality.

In the interest of time, may I just ask that judicial notice be taken of these speeches, the essential content of which has been stated partly by the defendant and partly by me: The speech of the defendant at Vienna on 10 March 1944, Number 10 in my document book, and the speech in Konigsberg on the occasion of the 400th anniversary of the university of his home province, on 7 July 1944, Number 11 in my document book.

MR. DODD: Mr. President, if this Document Number 11 is offered by the defense for the purpose of showing what this defendant's policy was toward the occupied countries, then I think it is proper for me to point out that the speech did not refer to the occupied countries but rather to the satellite states of Germany.

DR. SAUTER: Mr. President, may I also call attention to Document Number 3819-PS, which has already been submitted by the Prosecution. That is the record, which the defendant has mentioned, of the meeting with Minister Lammers on 11 July 1944.

According to this record, the Defendant Funk was present at that meeting, and mention is made of him in one sentence only; I quote, on Page 8 at the bottom: "Reich Minister Funk expects considerable disturbances of production in non-German territories in case of ruthless raids."


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This sentence, if taken from its context, is difficult to understand, but viewed in its proper connection, it makes it clear that the Defendant Funk wanted to warn against violent action in the recruitment of foreign workers for German production and for German armaments. He warned against any violent measures-against raids, as they are called in the protocol, because thereby, in his opinion, production in the occupied territories would be disturbed.

Then, Mr. President, may I mention mother document. It is Document Number 2149-PS, and it contains the following: A statement of the Reichsbank, dated 7 December 1942, "concerning the question of increasing French contributions to occupation costs."

May I say in advance that the cost of occupation in France was increased, but not upon the suggestion of the Defendant Funk and not with his approval, but in spite of his protest. And this statement to which the Defendant Funk has referred, and which I have just quoted-it is dated 11 December 1942-lists in detail the reasons why Funk and his Reichsbank very definitely protested against any increase in the cost of occupation.

In this connection, may I be permitted to question the Defendant Dr. Funk on the cost of occupation in Greece.

[Turning to the defendant.] Did you hear the testimony of the witness Dr. Neubacher, who was Minister to Romania and Greece, and who confirmed that there, also, you tried to reduce the cost of occupation?

THE PRESIDENT: Are you going to be much longer?

DR. SAUTER: Yes, I believe, Mr. President, it would be better if we adjourned now. I still have to put a few questions.

[The Tribunal recessed until 1400 hours.]


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Afternoon Session

THE PRESIDENT: The Tribunal will adjourn this afternoon at half past four.

DR. SAUTER: Witness, I would like to return to the question of the so-called spoliation of the occupied countries. As Reich Minister of Economics, which you were at the time, you can certainly inform us from your personal experience and observation of the contribution of the occupied territories to Germany's war effort.

FUNK: The achievements of the occupied territories for the joint carrying on of the war were without doubt of great significance. ~ have always regarded the occupied territories synchronized with the total German economy as one great productive organism for carrying on the war, which would lead to a new order in Europe. Usually the same basic economic principles applied in the occupied countries as in Germany. In 1944 I had statistics compiled to show just how much the occupied countries had produced for the war effort in the 3 years of 1941, 1942, and 1943, and we reached the figure of 90,000 million Reichsmark. That is certainly an extraordinarily high figure, but one must not forget that the currencies of the various countries were converted into Reichsmark. That is, the reduced purchasing power of the various currencies is not expressed in these figures In truth, therefore, the production is lower than these Reichsmark figures might show.

At the same time Germany utilized at least two-thirds of her entire production, that is, about 260,000 million marks worth, for the European war effort, in other words, almost three times as much as the occupied countries. Almost up to the time of the invasion I succeeded, in the case of France, in regulating the financial and monetary system and thus also the economic and social order to such an extent that, at the end of the German occupation, French finances were actually much healthier than German finances, and if it had not been for the circumstances resulting from the elementary impact of the war, France would have been able to construct a healthy monetary system on this basis.

My statistics are confirmed to a certain degree by a document which was submitted here. This is Exhibit RF-22 (Document Number F-515), and deals with the French deliveries to Germany. It is an official report to the French Government about forced labor in France. In this report there are tables on Pages 38, 39, and 40 showing the amount of French deliveries to Germany in proportion to the entire French production. These figures show that out of the entire French production with which we are dealing, in these three years an average of 30 to 35 percent was sent to Germany for the


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joint war effort. In some fields, and especially those which are necessary for the provisioning of the French population, such as textiles, pharmaceutical supplies, gas, electricity, and so forth, these figures are considerably lower and in some cases amount to only 5 or 6 percent. But as an economist I admit without hesitation that if these matters are not regarded from the point of view of the joint carrying on of the war and the joint economic relationship, a deduction of 35 percent means a lot and must naturally have serious repercussions for the entire economy.

I have no specific figures at hand for the Russian territories. The Ministry of Economics itself was entirely excluded from the war economy of these territories; we merely attempted to allow certain firms or companies to operate in these territories as private enterprises there, that is to say, they were to buy and sell at their own risk. I did not participate otherwise in the management of these regions outside of the fact that I was chairman of the supervisory board of the Continental Oil Company, which operated in these regions in conformity with the provisions of the Four Year Plan and the orders of the Wehrmacht. But I personally, as chairman of the supervisory board, had only to manage the financial affairs of this company.

DR. SAUTER: Witness, at the end of this morning's session you spoke of the so-called Central Planning Board, a body about which we have heard a good deal. You stated, although quite briefly, that as Minister of Economics you had no interest in the fact that foreign workers were transported to Germany, no matter whether for armament or other purposes. Did I understand you correctly?

FUNK: That applies to the time when I became a member of the Central Planning Board.

DR. SAUTER: When was that?

FUNK: I was called into the Central Planning Board in the fall of 1943, when I turned over all production matters to Speer and when, for the first time, on 22 November 1943 I attended a session of the Board. At that time I not only had no interest in having foreign workers brought to Germany but actually, from the economic aspect, I wanted to have the workers remain abroad, for the production of consumer goods had, to a large extent, been shifted from Germany to the occupied countries so that in other words this production, that is, French production or Belgian production, could work unhindered for the German populace; I did not want the workers taken away, and particularly I did not want them to be taken away by force, for in that way the entire order and the whole social life would be disturbed.


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Before that time, as Minister of Economics, I was naturally interested in seeing that the German economy had workers. However, these questions were not dealt with in the Ministry of Economics, but either in the Four Year Plan, where a Plenipotentiary General for Labor had been active from the beginning...

THE PRESIDENT: [Interposing.] Surely we heard all this this morning. It was all given this morning.

DR. SAUTER: In connection with the Central Planning Board, perhaps I might refer to one more document, Mr. President.

[Turning to the witness.] And this, Witness-and please confine your answer to this letter only-is a letter which you once wrote to Field Marshal Milch and which was submitted, I think, by the French Prosecution as Exhibit RF-675, (Document Number RF-675). In this letter, Herr Funk, you apologized for participating so very infrequently in the meetings of the Central Planning Board. And at that time you sent two experts from your ministry to the session, that is, two experts in the field of administrating civilian supplies and of the export trade. As deputy of your State Secretary, Dr. Hayler, who will be called later as a witness, a certain Ohlendorf participated at this meeting of the Central Planning Board. You have already seen this man, Ohlendorf, in this courtroom on the witness stand. I should be interested to know what were the functions of this man Ohlendorf who apparently belonged to your ministry.

FUNK: As far as the negotiations of the Central Planning Board were concerned, I was essentially interested only in the fact that in that meeting the necessary raw materials were allocated for the administration of consumer goods and the export trade. For that reason Ohlendorf and two other experts for the administration of consumer goods and the export trade were sent to the meeting. Ohlendorf was brought into my Ministry by State Secretary Hayler. Before that I had only known Ohlendorf vaguely from one or two meetings and I had had an extraordinarily favorable impression of him, for he had an extremely lucid mind and could always express his thoughts in a most impressive way. Before that time I didn't even know that Ohlendorf had another position in the Reich Security Main Office, for he was introduced to me as a manager of the Main Organization for German Trade. Hayler was the chief of this organization, of the Reichsgruppe Handel, and Ohlendorf was his manager and was introduced to me as such. Therefore I had no objections to Ohlendorf being brought into the ministry and taking over that field which corresponded to his private business activities up to now-the province of administration of consumer goods.


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Then through Hayler he discovered that Ohlendorf was active also in the RSHA-or whatever the name is-as an office chief in the SD. However, I took no exception to this activity, for I was not fully acquainted with these assignments and in any case I was not convinced that anything was taking place which was unacceptable for the Ministry. Ohlendorf was active chiefly as manager of the Reichsgruppe Handel. As far as I know, he only had an auxiliary occupation in the RSHA, or however it was called. Naturally I was very much affected and painfully surprised when I heard here about assignments which Ohlendorf with his "Einsatzstab" had had in previous years in Russia. I had never heard one word about this activity of Ohlendorf. He himself never mentioned these things to me and until this time I did not know the type of assignments such `'Einsatzstabe" had.

Ohlendorf never talked about his activity in the SD. Hayler, who knew him much better and more intimately than I did, is better qualified to give information. In any event I knew nothing of this activity of Ohlendorf, which after all he had carried on in years prior to this date, and I was very much affected to find that this man had done such things.

DR. SAUTER: Witness, I must ask you to state your position in regard to the testimony given by another witness, whom we have seen and heard in this courtroom. This witness is Dr. Blaha, who made a report in this courtroom about the conditions in the concentration camp at Dachau and who testified-as you probably will recall-that in and around Dachau it was common talk that the Reich Minister of Economics, Dr., Funk, had also been present at one of these official visits to the camp. As you recall, this witness replied to my question that he himself had not seen you, but that your name had been mentioned in this connection by other inmates. Were you ever at Dachau or at any other concentration camp?

FUNK: No, I was neither at Dachau nor in any other concentration camp.

DR. SAUTER: Can you say that with a clear conscience under your oath?

FUNK: Yes.

DR. SAUTER: The witness, Dr. Blaha, has also testified to the fact that this inspection of Dachau took place following a discussion among the finance ministers which had taken place at Berchtesgaden or Reichenhall, or somewhere in that vicinity. Therefore I ask you: Did you ever participate in a meeting of finance ministers, or at least at the time Blaha claims?


6 May 46

FUNK: No, I never participated in a meeting of finance ministers, because I myself was never such a minister. And at that time I did not participate in any international discussions at ale No.

DR. SAUTER: Dr. Funk, as far as your health is concerned, this is not a good day for you. You have complained about the bad pains which you are suffering today. Consequently, I do not wish put any further questions to you, except one in conclusion, which I am sure you will be able to answer briefly.

Why did you remain in your office as Reich Minister of Economics and as President of the Reichsbank until the very end?

FUNK: I considered myself bound to remain in this position as long as I could, in order to serve and be of use to my people. It was precisely during the last few years of the war that my position was a very difficult one. The administration became greatly disorganized and I had to make exceptional efforts in order to procure supplies for the people, especially those who had been bombed out. I continually had to protect the supplies and supply depots from arbitrary seizures by the Gauleiter. In the case of one Gauleiter, I had to call the police. I did not follow the "scorched earth" policy which the Fuehrer had decreed, so that even after occupation by the enemy powers the supplies which were left could be used by the German people.

I had had instructions from the Fuehrer to issue a decree according to which the acceptance of allied invasion currency would be high treason and punishable by death I did not issue that decree. I made every effort to prevent State property and State money from being destroyed and wasted. I saved the gold deposits and foreign exchange deposits of the Reichsbank which were in the greatest danger. Briefly, until the last minute I believed it was my duty and responsibility to carry on in office and to hold out until the very end. Especially when we Germans learned that, according to the Morgenthau Plan, the status of the German people was to be degraded into that of shepherds and goatherds; that the entire industry would be destroyed, which would have meant the extermination of 30 million Germans. And especially after Churchill had declared personally that the German people would suffer from hunger and that epidemics would break out, only one thing was possible for me and for every decent German, and that was to remain at his post and do everything within his power in order to prevent this chaos.

I had no talent for being a traitor or a conspirator, but I always loved my fatherland passionately and my people as well, and up to the end I tried to do everything possible to serve my country and my people and to be of use to them.


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DR. SAUTER: Mr. President, perhaps in connection with this alleged visit to a concentration camp I might refer to a questionnaire which we received from the witness Dr. Schwedler, and which is found in the supplementary volume for the Funk case as Document Number 14. This affidavit, of the contents of which I would like to have you take official notice, essentially confirm;; that, since 1 February 1938, the witness Dr. Schwedler was the daily companion of the Defendant Funk; that Dr. Funk never visited a concentration camp; and that the witness would have to know of it if it were the case.

With these words, Mr. President, I conclude my examination of the Defendant Funk. I thank you very much.

THE PRESIDENT: Do any of Defendants' Counsel wish to ask questions?

Dr. Sauter, you said you were referring to an affidavit of Dr. Schwedler? Which was Number 14? You said you were referring to Dr. Schwedler's affidavit which you said was Number 14 in your supplementary book. It does not seem to be in ours.

DR. SAUTER: I beg your pardon, Mr. President, it is Number 13. I made a mistake. It is Number 13; in the supplementary volume, Number 13, Dr. August Schwedler. It is a questionnaire.

DR. OTTO NELTE (Counsel for Defendant Keitel): Witness, I have one question which I would like to put to you., The Prosecution has accused the Defendant Keitel as chief of the OKW, you as Plenipotentiary for the Economy and Minister Frick as Plenipotentiary for Administration, on a common ground. The men in these three offices are mentioned in the Reich Defense Law of 1938. Undoubtedly, they probably exerted certain functions which might be of significance. The Prosecution in this connection spoke of a Three Man College and attributed much authority and significance to this Three Man College in connection with the point the Prosecution is making of the planning and preparation of aggressive wars.

Now I ask you: Was there such a Three Man College and what were the functions of these three offices which have been mentioned, according to the Reich Defense Law?

FUNK: Due to the confusion reigning in the German administration we ourselves could scarcely keep things straight; so it is not surprising if the Prosecution is in error on this point. I myself never heard of this three-man committee or Three Man College until this proceeding. I did not know that I belonged to such a three-man committee or Three Man College or triumvirate or anything else. On the basis of the Reich Defense Law similar powers were given to the Chief of the OKW, to the plenipotentiary


6 May 46

for Administration and to the Plenipotentiary for Economics. These three, in deviation from the existing laws, could issue directives in which they had mutually to participate.

But it was the purport of this order that these directives could only be of a subordinate nature, which on the whole applied solely to the sphere of activity of the offices involved. Legislation for more important matters was made either by the Ministerial Council for Defense of the Reich-later only by way of circulating the bill from one minister to the other-or by Fuehrer decrees. As far as I know there were only three, four, or five meetings of this body. Later, the decrees of the Fuehrer were the real, the essential way of issuing laws. They were issued by the Fuehrer personally, and the offices involved were frequently only informed of the same. Therefore the three-man committee is only a fiction.

DR. NELTE: Thank you. I have no further questions.

DR. DIX: Dr. Funk, you spoke of the law for the regulation of national labor and you said that that law was issued under your predecessor. You spoke about `'my predecessor."

FUNK: No, you are wrong; I said "predecessors."

DR. DIX: Predecessors. Can you tell the Tribunal under which Reich Minister of Economics that was issued?

FUNK: This law was issued under Reich Minister of Economics Dr. Schmitt, as far as I remember, And the subsequent agreement with the German Labor Front probably took place in part under Schacht. I particularly remember the so-called Leipzig Resolutions.

DR. DIX: Then you also mentioned that there was an of flee subordinate to Schacht as Plenipotentiary for War Economy. You will remember that the witness Vocke denied the existence of such an office of Schacht's as Plenipotentiary of War Economy, and Schacht did the same thing. Which office did you mean? Describe the office that you mean.

FUNK: It was not an office in the sense in which it might have been interpreted here. It was a committee of experts of the various departments which was led by the representative of the Plenipotentiary for War Economy, who was Schacht, and later by my representative as Plenipotentiary for War Economy. Under Schacht's term of office it was State Counsellor Wohlthat and in my term of office it was Schacht's former State Secretary, Posse.

DR. DIX: Certainly. Now is it identical with the working committee which originated on the basis of the old Reich Defense Law and which existed before 1933?


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FUNK: I am not familiar with that.

DR. DIX: In any event, this working committee was composed of the various departments?

FUNK: Yes.

DR. DIX: Together with the OKW?

FUNK: With the OKW, with the Ministry of the Interior, and later, with the decisive participation of the Four Year Plan representative.

DR. DIX: And the expert for Schacht during Schacht's term was Dr. Wohlthat?

FUNK: As far as I know, yes.

DR. DIX: Then one more question. You talked about the so-called triumvirate with reference to a question by my colleague for the Defendant Keitel. The creation of the triumvirate, this activity which you have described, was after Schacht's time, I believe.

FUNK: Yes, I believe so. But there was no activity.

DR. DIX: No.

FUNK: I never participated in any session of the so-called Three Man College.

DR. DIX: No. You said it was a fiction.

FUNK: Furthermore, no meeting of these three men ever took place.

DR. DIX: No; you said it was a fiction.

DR. ROBERT SERVATIUS (Counsel for Defendant Sauckel): I have a question regarding the wages of the foreign workers. Did Sauckel make any special efforts in connection with the transfer of the wages? Do you know anything about that?

FUNK: Yes. Sauckel insisted very frequently at the Reichsbank and the Reich Ministry for Economics that there should be a largescale transfer of wages to foreign countries and the occupied territories. Naturally we were in a very difficult position here, because especially in the southeastern European countries the currencies had been greatly devaluated, and the purchasing power of German money had sunk considerably, whereas I maintained the stable rate of exchange so that the inflationary tendencies in these countries would not be strengthened and result in complete economic chaos through the fault of the currency control. Therefore we had to make additions to the payments to make up somewhat for the devaluation of the money in the occupied and other countries. Altogether, considerable sums were transferred. I would estimate these sums to be at least 2,000 million Reichsmark.


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DR. SERVATIUS: Do you know whether Sauckel tried to do something about the clothing for foreign workers? Was anything done?

FUNK: He made considerable efforts, and this was particularly hard on the Ministry of Economics, because with the small amount of raw materials which the Central Planning Board had made available this Ministry had to take care of the population, and through the ever growing number of people bombed out we received ever greater demands for supplies. Yet, in spite of that, we tried to comply with the demands of Sauckel as far as possible, but of course we could not do so entirely.

DR. SERVATIUS: To what extent was clothing material delivered? Can you give any figures?

FUNK: No, I cannot.

DR. SERVATIUS: Do you know anything about Sauckel's attitude towards Himmler, since, according to the Prosecution, he collaborated with him?

FUNK: I remember one particular incident. When I had fled to Thuringia with my gold reserve and the rest of my foreign exchange I called on Sauckel one evening; State Secretary Keppler, who has been mentioned here frequently, was also present.

In the course of the conversation Sauckel and Keppler got into a terrific dispute with Himmler. Sauckel told Himmler quite plainly that he had destroyed the administrative unity in Germany; that he was mainly responsible for the disorganization of the German administration, for through the SS he had created a state within a state. Sauckel said further, "How can the people keep discipline if the top men of the Reich themselves cannot keep discipline?"

DR. SERVATIUS: I have no further questions.

DR. EGON KUBUSCHOK (Counsel for the Defendant Von Papen): Is it true that after Von Papen's speech at Marburg in June 1934 Hitler asked you to go to Reich President Von Hindenburg at his country estate in Neudeck and to tell him the following:

Vice Chancellor Von Papen, because he was forbidden to make his speech public, had asked to be allowed to resign. This resignation would have to be granted, because Von Papen through his speech at Marburg was guilty of a severe breach of Reich Cabinet discipline.

FUNK: When Reich President Von Hindenburg was at his estate at Neudeck he frequently invited me to visit him. I have already mentioned that I associated with him on familiar terms. A visit like this took place when the matter of the Von Papen speech at Marburg arose, and the Reich Marshal suggested to the Fuehrer, as far as I recall, to have me inform the Reich President about this incident.


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The Fuehrer had me do this, and I told the Reich President that a conflict had arisen between the Fuehrer and Von Papen because of a certain speech. I did not know the contents of this speech, since in the meantime its publication had been forbidden. Then the Reich President simply replied, "If he does not maintain discipline, then he must be prepared to take the consequences."

DR. KUBUSCHOK: Thank you.

DR. HEINZ FRITZ (Counsel for Defendant Fritzsche): Witness, when and where did you meet your Codefendant Fritzsche?

, FUNK: When he was active in the press section of the Propaganda Ministry. One day he appeared before me and wanted money for "Transocean," and I granted him this money.

DR. FRITZ: You were State Secretary in the Propaganda Ministry at that time?

FUNK: Yes.

DR. FRITZ: That was in what year?

FUNK: That must have been in 1933 or 1934.

DR. FRITZ: When he came to you, did you know what position Fritzsche had in the Propaganda Ministry at that time?

FUNK: I knew that he was in the press section.

DR. FRITZ: Was this a leading position which he had? Was he perhaps head of a department?

FUNK: No. At that time the head of this department was Dr. Hahnke as far as I remember. Later it was Berndt.

DR. FRITZ: Could you observe whether Fritzsche was in any close contact with Dr. Goebbels?

FUNK: I was never called in to attend any of the discussions which Dr. Goebbels had daily with his experts. That was done through his personal assistant, Dr. Hahnke who later became State Secretary. But since Fritzsche was not the head of a department I assume that he was not called in to these discussions either. As far as I know mostly the heads of departments were called to these discussions, but certainly not Fritzsche.

DR. FRITZ: Then according to your knowledge, in your capacity as State Secretary at that time, he was not one of the closer collaborators of Dr. Goebbels, if I understood you correctly.

FUNK: At that time I do not believe so. Of course, I do not know what took place later.

THE PRESIDENT: The Prosecution?

MR. DODD: Witness, can you hear me?


6 May 46

FUNK: Yes.

MR. DODD: We have listened to your testimony since late Friday afternoon, and, as we understand it from your statements, you admit none of the charges made against you in the Indictment in any degree, with possibly one exception. I am not clear as to whether or not you were making an admission this morning with respect to your part in the persecution of the Jews. Would you tell us now whether or not you intended to admit your own guilt or the part that you played in the persecution of the Jews?

FUNK: I said this morning that I had a deep sense of guilt and a deep sense of shame about the things which were done to the Jews in Germany, and that at the time when the terror and violence began I was involved in a strong conflict with my conscience. I felt, I could almost say, that a great injustice was being done. However, I did not feel guilty in respect to the Indictment against me here, that is, that according to the Indictment I was guilty of Crimes against Humanity because I signed the directives for carrying out laws which had been issued by superior offices-laws that had to be made so that the Jews would not be entirely deprived of their rights, and so that they would be given some legal protection at least in regard to compensation and settlement. I am admitting a guilt against myself, a moral guilt, but not a guilt because I signed the directives for carrying out the laws; in any event not a guilt against humanity.

MR. DODD: All right. That's what I wanted to thoroughly understand. You also told the Tribunal, that you-I think you used the expression "often at the door but never let in," and I understand that to mean that in your own judgment you were really a little man in this Nazi organization. Is that so?

FUNK: Yes...

MR. DODD: All right. That's an answer. You might want to explain it later, but for the present purposes that will do.

FUNK: May I give an explanation to this. I wanted to state that in the position I held, there were always higher authorities which made the final decision. That was the case in all the positions I held in the State.

MR. DODD; Well, let's both examine some of the evidence, and see whether or not you were in fact always subordinated and always a little man who didn't get in.

First of all, there's one matter that I do want to clear up before going into the general examination. You recall when the Defendant Schacht was on the stand, he told the Tribunal that after he left the Reichsbank he had an office in his apartment, is that so?


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FUNK: Yes, he said that.

MR. DODD: Now of course you have told us, on another occasion, that he continued to have an of lice in the Reichsbank. Isn't that so?

FUNK: I don't know whether I said and where I said that, but it may be so. I was informed, at the time when he resigned, that he still went to the Reichsbank rather frequently, and that a room was reserved there for him. In addition he still had some personnel, a secretary whom he had taken with him from the Reichsbank-and that is all I know.

MR. DODD: Another question. You told us, on another occasion, that he had an of lice in the Reichsbank where he worked on certain bank data and where he still kept in touch with you every now and then. Isn't that so? Do you remember telling us that or not?

FUNK: No, it wasn't like that. Schacht seldom...

MR. DODD: If you don't remember, then I perhaps can help you a little bit. Do you remember being interrogated by Major Hiram Gans of the United States Army on June 2, 3, and 4 of 1945? Do you remember that? You know who was there-Goering was there, Von Krosigk was there, Lammers was there....

FUNK: Yes.

MR. DODD: All right. You were asked this question, weren't you, or rather, preceding this answer there were some questions?

Question: "Did Schacht retain any governmental position after his dismissal as President of the Reichsbank?" Then Goering put in an answer: "Reich Minister." Then another question: "Did he have any functions?" Goering again answered: `'He remained Minister without Portfolio." Then another question: 'Were there any Cabinet meetings he attended?" Goering answered again: "There were no Cabinet meetings at that time." Question: "Then it was purely honorary?" Goering said: "Practically."

Then you interposed with this statement (Funk is speaking): "Schacht, after his dismissal, kept an office in the Reichsbank, where he worked on statistical data of the Reichsbank and where he still kept in touch with me every now and then." Question: '`How long did this last?" Answer: "This lasted until Schacht's dismissal as Minister, probably in 1943."

You made those answers, that answer, did you not?

FUNK: That is not correct. I did not express myself that way. I said only that I had been informed that he came to the Reichsbank frequently, that there was a room reserved for him and that he very seldom spoke to me. He seldom called on me. That was not translated correctly.


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MR. DODD: You know what I am reading from, do you not? You know this Document, Number 2828-PS?


MR. DODD: Parts of this are already in evidence as Exhibit USA-654. And later, in another form, I shall submit this part which I have just read.

Counsel Sauter, for you, this morning referred to a letter which you had written to Hitler, I believe it was in 1939, a very fulsome letter which you said was somewhat due to the general feeling at the time and also to the fact that it was about your 50th birthday. Is that so? There was another reason for your writing that letter in connection with your birthday, wasn't there? Do you know to what I refer?

FUNK: Yes.

MR. DODD: You received 520,000 Reichsmark from Hitler as a birthday present?

FUNK: No, that is not correct.

MR. DODD: Didn't you receive a present from Goering and Goebbels . . .

FUNK: Yes...

MR. DODD: Wait a minute till I get through-you don't seem to remember-you received a present from Goering and Goebbels in the first instance which had been made up of 250,000 Reichsmark from leading businessmen in Germany and 270,000 Reichsmark which came out of special accounts maintained by Goering and Goebbels. Then Hitler heard about that and ordered you to return that money because of the fact that some of it came from industry, and he himself gave you a so-called donation to the sum of 520,000 Reichsmark, isn't that so?

FUNK: The first is not correct, but the latter is correct. But may I explain the details; they are of a completely different nature.

MR. DODD: Go ahead.

FUNK: On my fiftieth birthday the President and Directorate of the Reich Chamber of Economics, the chief organization of the entire German economy, called on me and declared that because of my more than 20 years of service to German economy they wanted, with the approval of the Fuehrer, to make me a gift of an estate in Bavaria. That was a doubtful present, for later I had much worry and trouble because of it. A large house was built there because, as I was told, the Fuehrer had said that he also wanted me to work there. The taxes were so high, however, that I could not pay them, nor the remaining construction costs, either. Thereupon I did not


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appeal to Goering, but Goering heard about it and had 300,000 Reichsmark given to me in order to help me out of my financial straits. I did not receive any money from Goebbels, but with the approval of Goebbels the film corporation joined the Chamber of Economics in giving me this money. When the Fuehrer heard of the difficulties I had in paying taxes and making other payments he put a sum of 500,000 Reichsmark at my disposal. With the other money I received I made two donations, one of 500,000 Reichsmark to the Reichsbank for the families of the members of the Reichsbank killed during the war and another of 200,000 Reichsmark to the Reich Ministry of Economics for the families of members of that office who died in the war. I was able to live in, and pay for the upkeep of, this large house and grounds only because I had a relatively large income. However, from the beginning, when I saw the tremendous costs and expenses connected with it particularly in taxes, et cetera, I decided, in agreement with my wife, that after my death this estate should again be donated either to the Reichsbank or to my East Prussian homeland. I also discussed this several times with the Reichsbank Directorate.

MR. DODD: I am not much concerned with what you did with it, I only want to know if you got it. And you got it, didn't you? You got 520,000 Reichsmark.

FUNK: Yes.

MR. DODD: You also made a present out of public funds on your own account to the Defendant Frick on one occasion, didn't you? Didn't you give Frick a birthday present of 250,000 Reichsmark on 12 March 1942?

FUNK That I don't know.

MR. DODD: You don't remember? You don't remember that? Do you know anything about the other gifts that were given to any of these other defendants out of public funds, either through your position as President of the Reichsbank or as an important functionary of the Nazi Party? Do you know anything about these other men and what they have got from the public treasury?

FUNK: These moneys were not given by me. They were given from the fund of the Fuehrer by Lammers. I did not dispense such moneys.

MR. DODD: They were public funds, were they not? They did not come from anywhere else except the public? You don't know then that Rosenberg got 250,000 Reichsmark? Did you know that?


MR. DODD: In January 1944; you were then President of the Reichsbank?


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FUNK: Yes, but these moneys never came from the Reichsbank. These were moneys from funds which were administered by Lammers and I assume that the moneys came from the Adolf Hitler donation or from other funds. But the Reichsbank had nothing to do with these funds.

MR. DODD: Do you know that Von Neurath got 250,000 Reichsmark on 2 February 1943? Do you know anything about that? You were the President of the Reichsbank then.

FUNK: I know nothing about that.

MR. DODD: You heard about Lammers and his 600,000 Reichsmark. You know that Keitel got 250,000 Reichsmark on 22 September 1942. You never heard about that?

FUNK: The Reichsbank had nothing at all to do with these things.

MR. DODD: You know that Von Ribbentrop got 500,000 Reichsmark on 30 April 1943. You never heard of that? General Milch got 500,000 Reichsmark in 1941; none of these things ever came to your attention?

FUNK: I never had anything to do with these matters. They were Lammers' concern and the money did not come from the Reichsbank.

MR. DODD: Now, I understood you to say that you were not the economic advisor in fact to Hitler or to the Nazi Party of the early days. That is in your own judgment you were not. It is a fact, however, that you were generally regarded as such by the public, by industrialists, by Party members and the high Party officials. Is that not so?

FUNK: I was called that, as I said here, on the basis of my activity in 1932. I acted as a mediator in conversations between the Fuehrer and some leading economists and for a short while carried out the activity in the Party which has been described here.

MR. DODD: You have called yourself the economic advisor on occasion, have you not? At least on one occasion, during an interrogation, did you not refer to yourself as the economic advisor for the Party? You remember that?


MR. DODD: I think you will agree that you were generally recognized as such, but the really important thing is that the public thought you were.

FUNK: I have testified here that I was called that by the press and from the press this designation apparently went into record. I did not use this term myself.


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MR. DODD: Were you the principal contact man between the Nazi Party and industry in the very early days?

FUNK: In 1932, and this is the only year which we need consider in connection with Party activities on my part, because I was not active in the Party before or after this year. I did arrange discussions between Hitler and leading men of industry, whom I can name. But other men also acted in that capacity; for example, State Secretary Keppler.

MR. DODD: I am not asking you about other men, I am asking you whether or not you were not a principal contact man. Actually you were encouraged by industry, were you not, to become active in the Party?

FUNK: Yes.

MR. DODD: You acted as a go-between for the Nazis and the big business in Germany.

FUNK: It did not take up much time, but I did it.

MR. DODD: Whether it took much of your time or not, that doesn't interest us. It took a little bit of your time. That's what you were doing?

FUNK: Yes.

MR. DODD: You remember Document Number EC-440 perhaps. It is really a statement that you made and prepared on the relationship of German industry to the Party in the National Socialist leadership of the State. You remember that paper you drew up on 28 June 1945? You may recall that you yourself said, "Keppler, who later became State Secretary, and who served as economic advisor to the Fuehrer before me...." You used that terminology. You recall that?

FUNK: Keppler?

MR. DODD: Yes, he was the advisor before you. You remember that?

FUNK: Yes.

MR. DODD: Now, in the Propaganda Ministry, if I understand you correctly, you want the Tribunal to believe that you were something of an administrative functionary and not a very important man, and you did not really know what was going on. Is that your position?

FUNK: No. I had quite a large task, and that was the direction of an extensive cultural and economic concern. I stated that here. It consisted of film companies, theaters, orchestras, the German Trade Publicity Council, and the administration of the entire German radio, an undertaking worth a hundred millions, that is to


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say, a very extensive activity, an organizational, economic and financial activity. But propaganda was taken care of solely and exclusively by Goebbels.

MR. DODD: Yes. You knew the policies and the purposes of the Propaganda Ministry; there isn't any doubt about that?

FUNK: Yes.

MR. DODD: You knew that, did you not?

FUNK: Yes.

MR. DODD: All right. Now, we can pass on to one other matter that I referred to earlier, to clear up another matter. Do you recall that the Defendant Schacht, when he was on the stand, said, I believe, at that now famous meeting where a number of industrialists were gathered to greet Hitler, that he did not take up the collection? Schacht said he did not do it. I think he said that Goering did it or somebody else. Do you remember that testimony about Schacht on the stand? You remember being interrogated about that subject yourself?

FUNK: Yes.

MR. DODD: Do you remember what you told us at the time?

FUNK: Yes.

MR. DODD: What did you tell us?

FUNK: I said that Schacht after addresses by Goering and Hitler made a brief speech, and that he asked those present to, so to say, go to the cashier and subscribe, that is, raise money for the election fund. He took over the collection and said that the coal industry. . .

MR. DODD: Who?

FUNK: He said...

MR. DODD: Who was the one who took up the collection? I don't understand whom you mean by "he."

FUNK: Schacht.

MR. DODD: That's all I wanted to know about that. When did you first learn that the uprisings of November 1938 were not spontaneous?

FUNK: On the morning of 9 November, on my way from my home to the Ministry, I saw for the first time what had taken place during the night. Before that I had not had the slightest hint that such excesses and terror measures had been planned.

MR. DODD: I think you misunderstood me. I did not ask you when you first came to know about the uprisings; I asked you when you first learned that they were not spontaneous; when you first learned that they were instigated and planned by somebody else.


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FUNK: I only found out about that later.

MR. DODD: Well, how much later?

FUNK: I believe very much later. Later on there was much discussion about this matter and it was never clear just who had been the instigator of these measures of terror and violence and where the order had originated. We knew that it had come from Munich. We had learned that in the meantime on 9 November; but, whether it was Goebbels or Himmler, and to what extent the Fuehrer himself participated in this measure, I was never able to find out clearly. From my telephone conversation with Goebbels, which I mentioned today, one thing was clear: The Fuehrer must have known about this matter, for he told me that the Fuehrer had decreed, and Goering also said this, that the Jews were completely to be eliminated from economic life. From this I had to conclude that the Fuehrer himself knew about this matter.

MR. DODD: Now from that telephone conversation we can also see one other thing. You knew that Goebbels had started this business, did you not, and that was the day after it happened? You knew it was not spontaneous and that is why you called up Goebbels and got after him; is that not so?

FUNK: Yes.

MR. DODD: How many days later did you make that inflammatory speech about what should be done to the Jews? About six days afterwards, did you not? I am referring to the one that was published in the Frankfurter Zeitung; your counsel referred to it this morning.

FUNK: Yes, to begin with. . .

MR. DODD: And in that speech you tried to make it appear to the public that that was a spontaneous uprising, did you not?

FUNK: Yes.

MR. DODD: That was not true, was it?

FUNK: I did not know that at the time. At that time I still believed that it was really something favored by large elements of the population. Very much later I found out that routine machinery had been put in motion.

MR. DODD: Are you telling this Tribunal now that on the morning of your telephone call to Goebbels, when you in effect blamed him for these uprisings, you were not well aware then that he had started it? Is that your position?

FUNK: At that time I did not know who had started this regime of terror and how it had been carried through; that was entirely new to me.


6 May 46

MR. DODD: If you did not know who started it, you knew that somebody started it and that it was not spontaneous?

FUNK: Yes.

MR. DODD: And still in your speech of 15 November you tried to make it appear to the public that it was just an uprising on the part of the German people, did you not?

FUNK: I based that on the attempted assassination of-I do not know who he was; some attaché in Paris-and actually the attempt caused much agitation. There is no doubt of it.

MR. DODD: Now I think you understand my question, Witness. You said on that occasion, you used these words: "The fact that the last violent explosion of the indignation of the German people because of a criminal Jewish attack against the German people took place," and so on, and you went on. You were trying to make it appear there that this was a spontaneous reaction of the German people, and I insist that you knew better and had known it for some days, had you not?

FUNK: But I did not know that that is what took place. I admit that I knew that an impulse had come from some of lice or other.

MR. DODD: Well, all right. When did you coin the expression "crystal week"? Do you know what that expression is; where it came from?

FUNK: "Crystal week?"

MR. DODD: Yes.

FUNK: Yes, I did use these words once in connection with this action.

MR. DODD: You coined the phrase.

FUNK: Because much was shattered.

MR. DODD: You are the fellow who started that expression. You are the man, are you not? that was your expression?

FUNK: Yes, I used it.

MR. DODD: And you were using it-because you made this Frankfurter Zeitung speech?

FUNK: I once characterized that action with that term, it is true, because much had been shattered.

MR. DODD: Now, let us move on a little bit to the well-known meeting of 12 November, when Goering and Goebbels and all of the other people made their remarks about the Jews and you said you were present. You did not make any objection that day to anything that was said, did you?


6 May 46

FUNK: No. I merely attempted to have certain things put through in order to save something for the Jews, for example, their securities and stocks. Then I managed to have the stores reopened, so that things would move less rapidly, and I did more, too.

MR. DODD: I understand that, but I thought this morning you were really pretty sensitive about the terrible things that had happened to the Jews, and you remember some of the suggestions that were made that day by Goering and Goebbels; they were pretty nasty things, were they not?

FUNK: Yes, I openly admitted that I was much shaken. ..

MR. DODD: Were you? Well . . .

FUNK: And that my conscience bothered me. O

MR. DODD: All right. You went on after that and made your Frankfurter Zeitung speech and you carried out these decrees, even though your conscience was bothering you; is that so?

FUNK: But the decrees had to be issued. I have already emphasized that several times here. I had no pangs of conscience because the decrees were issued. I had pangs of conscience because of the reasons for them. But the decrees themselves-

MR. DODD: That is what I'm asking you about.

FUNK: But the decrees had to be issued. The reasons for them -yes; I admit that.

MR. DODD: You know Schacht said on the stand that if he had been the Minister of Economy he did not think those things would have happened? Do you remember him saying that here the other day, do you?

FUNK: Yes. He must have had very powerful and influential connections in the Party, otherwise he could not have been successful.

MR. DODD: You did not have these connections in the Party, did you? You were not in the Party, you were a Minister?

FUNK: No, I did not have these connections and I could not prevent these terror actions.

MR. DODD: Well, we will see about that. Your counsel has submitted on your behalf an affidavit from one Oeser, O-e-s-e-r; do you remember that man? O-e-s-e-r, do you remember him?

FUNK: Yes.

MR. DODD: Do you remember him? O

FUNK: Yes.


6 May 46

MR. DODD: And his affidavit-interrogatory, I believe it was . . .

THE PRESIDENT: Mr. Dodd, we will adjourn for a bare 10 minutes.

[A recess was taken.]

MR. DODD: Witness, I was inquiring about this man Oeser when we recessed-O-e-s-e-r; do you recall him? He was one of your employees in the Frankfurter Zeitung, was he not?

FUNK: Yes, he was the chief of the Berlin administration office of the Frankfurter Zeitung, a respected journalist.

MR. DODD: Yes. You know, do you not, that you have an interrogatory or an affidavit from him, which you are submitting to this court; it is in your document book?

FUNK: He volunteered to do that.

MR. DODD: Well, I'm not asking you-that is all right-whether he did or not; I just wanted to establish that you know that he did.

FUNK: Yes.

MR. DODD: Now, in that affidavit, as I read it, Oeser maintains that you were really being quite decent about the Jews in that newspaper. Is that not so? Is that not the sense of it; that you saved them from dismissal and so on, you put them under the exceptions provided in the decrees?

FUNK: Yes.

MR. DODD: All right.

FUNK: I allowed quite a number of editors to come under these exceptions.

MR. DODD: Yes, I know. Now I want to ask you this: There was a real reason, other than decency towards Jews, for your conduct with reference to that particular paper, was there not?


MR. DODD: Well, now, wait a minute.

FUNK: I do not know these people personally.

MR. DODD: I do not say that you knew the people personally. I say that there was a reason, other than your feeling for Jews as people, but which you have not told the Tribunal about yet, another reason maybe.

FUNK: In the case of the editors of the Frankfurter Zeitung?

MR. DODD: Yes.



6 May 46

MR. DODD: Now, is it not a fact that you and probably Hitler, and certainly Goebbels, and some of the other higher-ups of the Nazi Party, decided that that paper should be left in status quo because of its vast influence abroad? Is that not true?

FUNK: We did not tank about that at that time. That issue came up later. It came when the Fuehrer demanded that almost all leading daily newspapers should either be taken over by the Party or merged with Party papers. And on that occasion I succeeded in having exception made for the Frankfurter Zeitung, and the Frankfurter Zeitung continued to exist for a long time. But that was much later. Here, in fact, the only reason was to help a few Jewish editors.

MR. DODD: Well...

FUNK: It was a purely humane reason.

MR. DODD: You can answer this. I just wanted to get your answer on the record because I'll have more to say about it later. Do I understand you to deny that it was your established policy to preserve the status quo of the Frankfurter Zeitung because of its influence abroad?

FUNK: No, it was always my opinion that the Frankfurter Zeitung should remain as it was.

MR. DODD: Well, was it for the reason that I suggest, because these people were well known in the financial world abroad, and you did not want to impair the usefulness of that paper abroad? That's what I'm getting at, and I say that that is why you kept them on, and not because you felt badly about their plight as Jews.

FUNK: No, not in this case. In this case that was not the reason.

MR. DODD: Very well; now, with respect to your activities as the Plenipotentiary for Economy and their relationship to the wars waged against Poland and the other powers, I have some questions that I would like to ask you. Now I will tell you what it is about first, so you will be aware. You are not maintaining, are you, that your position as Plenipotentiary for Economy did not have much to do with the affairs of the Wehrmacht?

FUNK: Yes, I assert that. With the Wehrmacht...

MR. DODD: Now, I have in my hand here a letter which Von Blomberg wrote to Goering. Do you remember that letter? It is a new document and you have not seen it in this Trial, but do you remember any such letter?


MR. DODD: Well, I ask you to be handed Document Number EC-255.


6 May 46

[The document was handed to the defendant.] Mr. President, this becomes Exhibit USA-839.

[Turning to the defendant.] Now, in this letter from Von Blomberg, I am only concerned now with the last sentence, really. You will notice that Von Blomberg, in this letter, refers to the fact that Schacht had been appointed, but the last sentence says, or in the next to the last paragraph he first urges that you be appointed immediately, and that is underlined in his letter; and in the last paragraph he says:

"The urgency of unified further work on all preparations for the conduct of the war does not admit of this office being paralyzed until 15 January 1938."

This letter, by the way, was written on 29 November 1937. Certainly Von Blomberg thought that the job that he was suggesting you for would have some very great effect upon the conduct of the war, did he not?

FUNK: That may be, but in the first place, I do not know about that letter and, secondly, I was not immediately appointed Plenipotentiary for Economy but only in the course of 1938. Quite some time after I had been appointed Minister for Economics I asked Lammers why my appointment as Plenipotentiary for Economy had taken so long; he replied that my relationship to the Delegate for the Four Year Plan had to be cleared up first. That was the reason why several months passed before I became Plenipotentiary for Economy, because it had to be ascertained that Goering had the decisive authority for war economy...

MR. DODD: You really do not need to go into all that.

FUNK: I do not know about that letter, and I have never spoken to Von Blomberg about the affair.

MR. DODD: All right. You do recall perhaps that the OKW, after you were appointed, made some objection about the amount of authority that you had. Do you remember that?


MR. DODD: Now, I am holding here another new document, Number EC-270, which I will ask that you be shown, which will become Exhibit USA-840. While you are waiting for it, I will tell you that it is a letter written on 27 April 1938. You will notice that in the first paragraph of this letter from the OKW it says that the interpretation which has been put on the decree of the Fuehrer-the decree of 4 February 1938-does not correspond to the necessities of total warfare.

And then you go down to the third paragraph on that first page and you will find other objections with respect to your authority.


6 May 46

Apparently at this time the OKW thought you had too much to do with what would be the war effort, and finally on the last page, Mr. Witness, if you will look at this paragraph, you will see this sentence-on the last page of the English, anyway; near the end of the letter this sentence appears:

"The war economy, which is subordinated to the Plenipotentiary, represents the economic rear area of the armaments industry."

And I want you to observe carefully those words "armaments industry."

And then it goes on to say:

"If this stage fails, the striking power of the Armed Forces becomes questionable."

I ask that you pay attention to the words "armaments industry," because I recall that this morning you said you had absolutely nothing to do with the armaments industry; but apparently the OKW thought that you did, on 27 April 1938. Is that not so?

FUNK: I do not know this letter either. I do not know the attitude of the OKW but I do know this: The OKW, especially the Codefendant Field Marshal Keitel, was of the opinion at that time that I, as Plenipotentiary General for War Economy, should assume the authority and competence of Schacht; but there was a conversation between the Reich Marshal and Field Marshal Keitel-Keitel confirmed this to me-in which the Reich Marshal clearly declared; "The war economy will not be turned over to Funk." I can honestly and sincerely say that I did not have the slightest idea of all these things. I did not know what kind of position the OKW intended me to have. I never had that function because the administration for the armaments industry was never included in the Ministry of Economics. I do not remember the matter.

MR. DODD: All right. That is your answer. I suppose at the time you were also aware, as you told the Tribunal, that you were really subordinate to Goering and in a very inferior position about all of these things. Is that so?

FUNK: Yes.

MR. DODD: I am going to ask you to look at another Document, Number EC-271, which will become Exhibit USA-841, and this document consists of a letter which you wrote to Lammers, a letter which Lammers wrote to the Chief of the High Command, Field Marshal Keitel, and one or two other letters not pertinent for the purposes of this present inquiry. It was written on 31 March 1938, and I want you to turn to the second page because that is where your letter appears. The first page is just a letter of transmittal


6 May 46

from Lammers to Keitel, but let us look at the second page. Have you got it?

FUNK: Yes.

MR. DODD: You are writing to Lammers and you say-I am not going to read the whole letter, but the second paragraph. You wrote to Lammers and you say among other things:

"On the occasion of a trip to Austria I have, among other matters, also talked to Field Marshal Goering about the position of the Plenipotentiary for War Economy. I pointed out in this conversation that, contrary to the attitude of the OKW, of which I was informed, the decree of 4 February 1938. concerning the leadership of the Wehrmacht did not change the position of the Plenipotentiary for War Economy."

And you go on-aside from the fact that the decree applied exclusively to the command of the Armed Forces, and so on, and that especially the last paragraph of that decree stated that you were dependent upon instructions of the Fuehrer-to say:

"Moreover, among the instructions of the Fuehrer is included the decision of the Reich Government of 21 May 1935, according to which the Plenipotentiary for War Economy, in his sphere of duty as supreme Reich authority, is immediately subordinated to the Fuehrer.

"General Field Marshal Goering assured me that my interpretation, as mentioned above, was correct in every respect and also corresponds with the Fuehrer's opinion. Thereupon I asked him to give me a brief written confirmation. Field Marshal Goering promised to grant this request."

Now, you wrote that letter to Lammers, did you not, on 31 March 1938, "yes" or "no?"

FUNK: Certainly.

MR. DODD: All right. You were trying to have supreme authority and make yourself answerable only to the Fuehrer and that is what this contest was about, and that is what Document Number EC-271 referred to and this is your answer to the OKW's objection that you had too much power. This does not look like you were a little man, does it, Mr. Witness?

FUNK: Yes. I wanted to clarify the position, but later it was not clarified in that sense but in the sense that I was dependent upon the directives of the Reich Marshal. I wrote this letter in order to try to obtain a clarification, but I do not remember this letter in


MR. DODD: You told Lammers. . .


6 May 46

THE PRESIDENT: Mr. Dodd, is not this letter that you have just read the very letter which is referred to in the letter which you put to him immediately before?

MR. DODD: Yes, Sir, it is. It referred to EC-271. I am sorry, I said 271, I meant 270.

THE PRESIDENT: GB Number 649/38 is the letter you just read. Will you look at the first paragraph of EC-270; the letter referred to there, criticizing, is the Defendant Funk's letter you just read.

MR. DODD: Yes, it is, your Honor.

[Turning to the witness.] My point here, Mr. Witness, is that, you see, you told the Tribunal that you really just worked for Goering; that you did not have much to say about these things, but now we find that you were writing a letter asserting your supreme authority and saying now, "it is a fact that I am really only answerable to Hitler," and, you see, those two are quite inconsistent. What have you got to say about that?

FUNK: Yes; in fact, I was never successful.

MR. DODD: Now, let us see if you were not. Now you turn another page in that document and you will find another letter from Lammers, written on 6 April 1938, and it is written to you, and he tells you that you are just right in what you understood to be your position; that you are indeed only subordinate to the Fuehrer and that he has sent a copy of your letter to both Field Marshal Goering and the Commander of the OKW. Now, what do you say about that?

FUNK: I see from this that I tried at that time to achieve that post, but in fact I never succeeded because the Reich Marshal himself stated later that he would never turn over the war economy to me. The formal authority of the Plenipotentiary for Economy was turned over to the Four Year Plan by a decree of the Fuehrer of December 1939.

MR. DODD: Well, is that your answer? Now, you also have told the Tribunal, as I understood you at least, that you really did not have much to do with the planning of any aggressive wars, and that your activities were restricted to regulating and controlling the home economy, so to speak. Now, actually on 28 January 1939, which was some months before the invasion of Poland, you were considering the use of prisoners of war, were you not?

FUNK: That I do not know.

MR. DODD: Are you sure about that? Now I will ask that you be shown another document, Number EC-488 which becomes Exhibit USA-842. This is an unsigned letter, a captured document from


6 May 46

your files. This letter, by the way, was transmitted under the signature of Sarnow. You know who he was; he was your deputy. Now, this letter, dated 28 January 1939, says that its subject is "Re: Employment of Prisoners of War." Then it goes on to say:

"Under the Reich Defense Law of 4 September 1939 I have the direction for the economic preparations for the Reich defense, except the armament industry."

Then it goes on, "For the utilization of labor..." and so on. But what I want to call your attention to particularly is the sentence in the second paragraph which says:

"The deficit in manpower may force me to the employment of prisoners of war as far as possible and practical. The preparations, therefore, have to be made in close co-operation with the OKW and GBW. The offices under my jurisdiction will duly participate therein."

Remember that communication?

FUNK: No, I have never seen that letter, and never signed it. Put that letter belongs to the matters about which I spoke this morning. The of lice of the Plenipotentiary for Economy-moreover, I see "Plenipotentiary for War Economy" is scratched out-was continuously occupied with these things. I personally had nothing to do with it.

MR. DODD: Well now, that is rather playing with words. This was your Ministry that was making these suggestions, and your principal deputy who transmitted this letter, is that not so?

FUNK: No, that was...

MR. DODD: Now, you look up in the right hand corner of that letter and see if it doesn't say "The Plenipotentiary for the Economy," and then it gives the address and date. ~

FUNK: Yes, and it is signed "By Order: Sarnow."

MR. DODD: That is right, and he was your principal deputy, was he not?


MR. DODD: What was he?

FUNK: He only worked in the office of the Plenipotentiary General. My main deputy, who was in charge of those things, was Dr. Posse.

MR. DODD: Well now, at any rate...

FUNK: As I have said before, I personally had nothing to do with these things whatsoever.

MR. DODD: It has just been called to my attention that if you say the man was Posse, then in the second paragraph of that letter


6 May 46

you can find his name: "I can refer to the statements of Generaloberst Keitel, State Secretary Dr. Posse..." At any event, important people in your organization were involved in this thing, were they not?

FUNK: Certainly.

MR. DODD: All right. Now, you remember the Document Number 3562-PS. It was introduced here as Exhibit USA-662. It is the minutes of a meeting set out by Dry Posse, your deputy, which discussed a memorandum for financing the war, and you talked about that this morning and you said that despite the fact that there is a note on it "to be shown to the Minister," you never saw it.

FUNK: I would have had to initial it if I had seen it.

MR. DODD: Well, whether that is so or not, I am not concerned about right now. Instead, I want you to listen while I read an excerpt from it. If you would like to see the document you can have it, but I hardly think it is necessary. You recall that in that document one of your memoranda is referred to, is it not? Do you remember? Do you remember that Posse said:

"It was pointed out that the Plenipotentiary for Economy is primarily concerned with introducing into the legislation for war finance the idea of financing war expenditures by anticipating future revenues, to be expected after the war."

FUNK: Yes.

MR. DODD: All right. That is an I have to ask about that document. We can move right along here.

Referring again to your own direct testimony, I understood you to tell the Tribunal that insofar as the war against Poland was concerned, you did not really know until some time in August that there was even a likelihood of war with Poland; some time in August you thought it would be settled by diplomatic means. Is that not so?

FUNK: In all probability not. For months there was a latent danger of war, but even in August one could see that it was imminent.

MR. DODD: Had you been planning or making economic plans for war with Poland for more than a year before the attack on Poland? You can answer that "yes" or "no.?'

FUNK: I do not know.

MR. DODD: You mean you did not know whether you had or not? What do you mean by that kind of an answer? Do you not remember?

FUNK: I do not remember.


6 May 46.

MR. DODD: All right. Then I can help you. There is a Document, Number 3324-PS, which is already in evidence. You must remember it; it is Exhibit USA-661. That is a speech that you made. Is that not so? Do you not remember saying in it that you had been planning in secret for well over a year for the war on Poland? Do you remember that? Would you like to see the document?

FUNK: Yes, please.

MR. DODD: The sentence is here:

"Although all the economic and financial departments were utilized in the tasks and work of the Four Year Plan, under the leadership of Field Marshal Goering, the war economic preparation of Germany on another branch has also been advanced in secret for years..."

Do you remember that?

FUNK: Yes, now I know.

MR. DODD: You will notice it says here "for well over a year," and you went on to say this had been done under you. Is that true?

FUNK: Yes, that was the activity of the Plenipotentiary for civilian economy. I already explained that this morning.

MR. DODD: All right. Well, that is all right. I just wanted to get your answer...

FUNK: I did not speak of Poland.

MR. DODD: Well, that is the only war that was on when you made this speech. It was October 1939.

FUNK: The preparations were not made for a specific war, it was . . .

MR. DODD: All right.

FUNK: It was a general preparation.

MR. DODD: Now, actually you and Goering were even in a contest for power to some extent, were you not? Was the Goering door one of those that you were also trying to get in? You can answer that very simply. You told us you were trying to get in these various doors, but you would get up there and never get in. I now ask you if the Goering door was one of those.

FUNK: I do not believe that I was so presumptuous as to want to get Goering's post. That was far from being my intention. I had very little ambition at all.

MR. DODD: I did not say that you wanted to get his post, but you wanted to get some of his authority, did you not? Or do you not remember? Maybe that is the solution.



6 May 46

MR. DODD: Wed, your man Posse was interrogated here by representatives of the Prosecution and the document is Number 3894-PS. He was asked these questions:

"Question: What was the nature of the conflict between the Plenipotentiary for Economy and the Four Year Plan?'

"Answer: 'The struggle for power.'

"Question: 'The struggle for power between Funk and Goering?' "Answer: 'The struggle for power between Funk and Goering, between Funk and the Ministry for Agriculture and the Ministry of Communications.'

"Question: 'How was the struggle finally resolved?'

"Answer: 'Never. It was a struggle always continuing under the surface."'

Then we move on:

"Question: 'Did Funk, who had very important powers as Minister of Economics and later as Reichsbank President and as Chief Plenipotentiary for Economy, actually exercise these powers?'

"Answer: 'Yes. But the powers of Goering were stronger.'

"Question: 'Nevertheless, Funk did exercise important powers?' "Answer: Yes, as President of the Reichsbank, Minister of Economics, and Plenipotentiary for Economy."'

Posse was your chief deputy, was he not?

FUNK: Yes, but Posse's position was somewhat apart. My deputy was Landfried, and in the Reichsbank, Puhl. They knew these things better than Herr Posse.

MR. DODD: Well, all right.

FUNK: They should know more about it than Posse.

MR. DODD: You do not think he really knew what he was talking about when he said you were in the struggle for power? Is that your answer?


MR. DODD: [Turning to the Tribunal.] That becomes Exhibit USA-843. We have not offered it up to now. Now, Mr. Witness, I want to ask you about when you first heard of the impending aback on Russia. I understood you to tell the Tribunal that you heard about it some time-I think you said-in May. Is that right? Or June?

FUNK: When Rosenberg was appointed.

MR. DODD: Well, that is what we want to know. When Rosenberg, in April of 1941, was appointed, you knew then there was to


6 May 46

be an attack on Russia, did you not? But this morning I do not think you made that clear. Is that not right, Dr. Funk?

FUNK: Yes, I said that the reason given us for that appointment was that the Fuehrer considered a war with Russia to be possible.

MR. DODD: Yes, but you know what you told the Tribunal this morning. You said that Lammers sent you notice of Rosenberg's appointment because of your interest in improving the trade relations with Russia. That is the answer you made this morning. Now, that was not so, was it?

FUNK: Yes, Lammers has said that here, too.

MR. DODD: I do not care what Lammers said. I am asking you now if it is not a fact that you were told by Lammers because you were to co-operate with Rosenberg in making ready for the occupation of those territories after the attack began. Now you can answer that very simply. Is that not true?


MR. DODD: Now, we will see. You know, on another occasion you have given another answer, by the way, I might say, parenthetically. Do you remember telling the interrogator that you first heard from Hess about the impending attack on Russia? Do you remember you gave that answer at one time as the source of your first knowledge? Do you remember telling us that?


MR. DODD: I'll tell you about that in a minute. We will stay now on this Rosenberg business.

There is a Document Number 1031-PS and it is dated 28 May 1941, which would be a lithe more than a month after the Rosenberg appointment: "Top secret notes; meeting with Reich Minister Funk." Do you know what you were talking about that day, about counterfeiting money for use in Russia and the Ukraine and the Caucasus? Do you remember it?


MR. DODD: You do not remember it? Well, you had better take a look at the Document. It is Number 1031-PS, which becomes Exhibit USA-844. Do you not remember the day that your Reich bank Director Wilhelm said it should not appear that you were counterfeiting so-called ruble bills for use in the occupied countries? Rosenberg was at that meeting. It is a very short memorandum. Have you read it? Oh, it is on Page 4, I think, of the document that you have; I am sorry. Do you find it? It starts out: "In the Ukraine and the Caucasus, however, it would become


6 May 46

necessary to maintain the present currency, the ruble..." and so on. You were talking about money problems in the territory that you expected to occupy, and that was, well, about a month before the attack and about a month after Rosenberg's appointment, was it not? Can you not give me an answer?

FUNK: I have not found the passage yet. Yes, if these countries were conquered, it was necessary to deal with these questions.

MR. DODD: The point is that certainly by that time you knew about the impending attack on the countries that had to be conquered, did you not?

FUNK: I knew nothing of an attack. I only knew of an imminent danger of war.

MR. DODD: Well, all right, you have it your way. The important thing is that you were talking about using money in the Ukraine and in the Caucasus, and it happened about a month later.

FUNK: Yes.

MR. DODD: All right. There are quite a few questions I want to ask. I would like to close this examination before the adjournment time is due. Do you have anything you want to say to that? I only offered to show you that you had knowledge about the impending attack. You knew that something was going to happen in the East. That is all I wanted to ask. I think you will agree with that, will you not?

FUNK: Yes.

MR. DODD: All right.

FUNK: Since the appointment of Rosenberg-and I explained that quite clearly this morning-I knew that a war with Russia was threatening.

MR. DODD: We are all in agreement. We do not need to go further. I understood you to say this morning that you did not know. That is all right. I misunderstood you then. I now understand you to say that you did know it.

FUNK: I said quite clearly this morning that I was informed that the Fuehrer was expecting a war with Russia, but I am not sure about this document, as to who has written it.

MR. DODD: Well, I do not know either. I can simply tell you that it was captured, among other documents, from Rosenberg's files. I cannot tell you anything more about it. I think we can talk about something else, if you will permit me. I really do not think there is any need to go on with it.

FUNK: Yes, but it is important insofar as these things about the ruble have been attributed to me.


6 May 46

MR. DODD: I will say it is, too.

FUNK: It says here that I said that the use of the Reichskreditkassenscheine and the determining of the rate of exchange involved considerable danger. In other words, I was very doubtful in regard to the proposals made in this respect.

MR. DODD: All right. I am glad to have your observations about it. Now, I want to talk to you a little bit about when you took over the Reichsbank. Posse was your principal deputy in your Ministry of Economics, was he not?

FUNK: Landfried was my main deputy.

MR. DODD: And by the way, he was at the same meeting that we have just been talking about. Who was your principal assistant in the Reichsbank?

FUNK: Puhl.

MR. DODD: He was a holdover from the Schacht days, was he not?

FUNK: Yes.

MR. DODD: Did you induce him to remain? Did you ask him to remain?


MR. DODD: You said that you selected your personnel. That is what you told the Tribunal this morning.

FUNK: No. Puhl remained and also Kretschmann and Wilhelm.

MR. DODD: I am not interested in going through your roster of personnel. I am only asking-and I will tell you the purpose. Puhl was a reliable banking man, was he not? He was well known in the international banking circles. He had been offered a position in the Chase Bank in New York at one time, did you know that?

FUNK: No, I did not know that.

MR. DODD: Well, it is true. In any event, he was quite a man, and he is a reliable man, is he not?

FUNK: Yes.

MR. DODD: You asked for him as a witness, did you not?

FUNK: Yes.

MR. DODD: And you wanted him to come here because you believe him and you know he...

FUNK: Yes.

MR. DODD: Now, I want to talk a little bit about the gold in the Reichsbank. How much gold did you have on hand at the end of the year 1941, roughly? Do not give me a long story about it,


6 May 46

because I am not too much interested. I am merely trying to find out if you were short on gold in 1941.

FUNK: The gold reserve which I took over amounted to about 500 million Reichsmark when I received the post of Schacht.

MR. DODD: Well, all right.

FUNK: It was increased in any substantial manner only by the Belgian gold, as far as I know,

MR. DODD: That is really-it is interesting to hear all about it, but I have another purpose in mind. From whence did you obtain gold after you took over? Where did you get any new gold reserves from?

FUNK: Only by changing foreign currency into gold, and then, after I took over the post, we got in addition the gold reserve of the Czech National Bank. But we mainly increased our reserve through the Belgian gold.

MR. DODD: All right. Now, of course, gold became very important to you as a matter of payment in foreign exchange. You had to pay off in gold along in 1942 and 1943, did you not? Is that so?

FUNK: It was very difficult to pay in gold.

MR. DODD: I know it was.

FUNK: Because the countries with which we still had business relations introduced gold embargoes. Sweden refused to accept gold at all. Only in Switzerland could we still do business through changing gold into foreign currency.

MR. DODD: I think you have established that you had to use gold as foreign exchange in 1942 and 1943 and that is all I wanted to know. When did you start to do business with the SS, Mr. Funk?

FUNK: Business with the SS? I have never done that.

MR. DODD: Yes, sir, business with the SS. Are you sure about that? I want you to take this very seriously. It is about the end of your examination, and it is very important to you. I ask you again, when did you start to do business with the SS?

FUNK: I never started business with the SS. I can only repeat what I said in the preliminary interrogation. Puhl one day informed me that a deposit had been received from the SS. First I assumed that it was a regular deposit, that is, a deposit which remained locked and which was of no further concern to us, but then Puhl told me later that these deposits of the SS should be used by the Reichsbank. I assumed they consisted of gold coins and foreign currency, but principally gold coins, which every German citizen had had to turn in as it was, and which were taken from inmates


6 May 46

of concentration camps and turned over to the Reichsbank. Valuables which had been taken from the inmates of concentration camps did Not go to the Reichsbank but, as we have several times heard here, to the Reich Minister of Finance, that is...

MR. DODD: Just a minute. Were you in the habit of having gold teeth deposited in the Reichsbank?


MR. DODD: But you did have it from the SS, did you not?

FUNK: I do not know.

MR. DODD: You do not know?

Well, now, if Your Honor please, we have a very brief film, and I think we can show it before we adjourn, and I would like to show it to the witness before I examine him further on this gold business in the Reichsbank. It is a picture that was taken by the Allied Forces when they entered the Reichsbank, and it will show gold teeth and bridges and so on in their vaults.

FUNK: I know nothing about it.

MR. DODD: I think perhaps before I show the film I would like -I think I can do it in the time; I do want to complete this this afternoon-to read you an affidavit from this man Puhl who, you told me a few minutes ago, was a credible, well-informed man and whom you called as a witness. This affidavit is dated 3 May 1946.

DR. SAUTER: Mr. President, I protest against the reading of this affidavit by Herr Puhl. This affidavit most probably-I'm not sure-was taken here in Nuremberg. We do not know its contents. The Prosecution surprises us today with an affidavit of which we know nothing, and within ten minutes a dozen documents are thrown at us, of which the Prosecution asserts they are only short documents, whereas, for instance, one affidavit among them contains twelve pages, I believe. It is quite impossible for us, in the course of the extreme speed at which this examination is taking place, to follow these statements and these documents. Therefore I have to protest against the use of an affidavit of that kind at this moment.

MR. DODD: Well, this affidavit was taken at Baden Baden, Germany, on the 3rd day of May. We have been trying for a long time to put this part of this case together, and we have finally succeeded. Certainly we did not turn it over to Dr. Sauter, because we wanted to use it for just the purposes that I am trying to put it to now. And it is an affidavit of his assistant Puhl, whom he called as a witness and from whom he expects to have an interrogatory. It has to do with a very important part in this case. I might say that if we are permitted to use it, certainly Dr. Sauter will have a chance


6 May 46

to re-examine on it and he will have all night to study it if he would like to look it over.

THE PRESIDENT: Mr. Dodd, are you wanting to cross-examine the witness about this document?

MR. DODD: Yes, I want to read it to him and I want to ask him a couple of questions about it. I want him to know it because it is the basis for two or three questions of cross-examination, and to impeach him for statements he has already made about the gold.

THE PRESIDENT: You may do that. But Dr. Sauter, of course, will be able, if he wishes to do so, to apply afterwards that the witness should be produced for cross-examination. And he will have time in which he can consider the affidavit and make any comments that he wants to about it.

MR. DODD: Very well, Your Honor.

DR. SAUTER: Mr. President, may I make just one statement? Today a case occurred where the Prosecution protested against the fact that a document was used of which the Prosecution had not previously received an English translation. The representative of the Prosecution told me he did not understand German, and therefore the document had to be translated. I am of the opinion that the Defense should get the same right as the Prosecution.

If one English document after the other is thrown at me without my having the slightest idea of the contents, then I cannot answer them. Difficulties are constantly increasing. For instance, I have received documents here which contain 12 pages. One sentence is read out of such a document. The defendant is not given time to read even one single further paragraph. I myself am not given time. And in spite of that it is expected that the defendant immediately explains one single sentence taken out of the context, without having the possibility of examining the document. That, in my opinion, is asking too much.

THE PRESIDENT: Dr. Sauter, you had a translation in German of nearly every document, if not every document. And you have also been given every opportunity to consider documents when they have been translated into German. And that opportunity will be given to you hereafter and if there are any documents which are being used in cross-examination now which are not in German, they will be translated into German, and you will have them then. But once the witness is under cross-examination, the documents may be used. If you want to re-examine upon the documents after you have them in German, you will be able to do so.

DR. SAUTER: Mr. President, we Defense Counsel also desire to further the proceedings and not to delay them. But it does not help


6 May 46

me at all if, in a week or two, when I shall finally have been able to examine the documents thrown today on the table, I must turn to you, Mr. President, with the request to be permitted to question the witness again. We are glad once we are through with the examination of the witnesses. But we simply cannot follow Mr. Dodd's method. I cannot follow, and the defendant cannot either. One cannot expect the defendant to explain an isolated sentence taken out of the context, if he had no chance to examine the document as a whole.


MR. DODD: May I proceed to examine on the document?

THE PRESIDENT: Mr. Dodd, have you got any objection to Dr. Sauter's seeing the document?

MR. DODD: Yes, indeed I have. I think it would be a new rule. Ever since this Defense opened, we have presented and confronted documents for the purpose of impeaching the credibility of various witnesses, and used these documents, and it goes to the very foundation of cross-examination. If we have to turn such documents over to the Defense before we cross-examine, the whole purpose of crossexamination is gone.

THE PRESIDENT: Mr. Dodd, if you are putting the document in and putting it to the witness as a document, then his counsel is entitled, I should have thought, to have it at the same moment.

MR. DODD: We are perfectly willing to give him a German copy right now. It is here for him, if he wants to have it, and we were ready with it when we came in the courtroom.


MR. DODD: Yes, Mr. President.

THE PRESIDENT: I think the best thing will be for us to adjourn now, and then you will hand to Dr. Sauter when you use the document a translation of it in German.

MR. DODD: Yes; tomorrow morning, when we use it.

THE PRESIDENT: When you use it.

MR. DODD: Very well, Sir.

[The Tribunal adjourned until 7 May 1946 at 1000 hours.]


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